ZTE Bumps Motorola

Researcher iSuppli says ZTE broke into the top five handset makers while Moto slipped to No. 6.
In much of the world, ZTE is better known as a maker of telecom networking equipment and data cards than cellphones. But research firm iSuppli says the Shenzhen-based technology company shipped enough phones during the last quarter to break into the top group of handset makers, displacing Motorola.

The upset places ZTE among the largest five handset makers worldwide, an elite group that includes Nokia ( NOK - news - people ), Samsung, LG Electronics and Sony ( SNE - news - people )Ericsson ( ERIC - news - people ). ISuppli says ZTE climbed two spots to No. 5 by shipping 13.4 million phone units in the fourth quarter of 2009, equivalent to 4% of the global market. No. 4 Sony Ericsson had a 4.4% market share while the top three players--Nokia, Samsung and LG--controlled 38%, 21% and 10% of the market, respectively.

ZTE's success came at Motorola's ( MOT - news - people ) expense. The Schaumburg, Ill., phone maker dropped from No. 5 to No. 6 in iSuppli's results for the fourth quarter.

The shifting ranks could be a sign of ZTE's growing clout in the cellphone market. The company says it shipped a record 40 million handsets in 2009. Some of the phones went to Europe, North America and Japan in partnerships with operators like Telefonica ( TEF - news - people ), T-Mobile UK and Orange.

Motorola's drop could also be a reflection of the company's ongoing travails. An emphasis on costly smart phones has curbed Motorola's overall shipments.

ISuppli analyst Tina Teng, who calculated the ranking, says most of ZTE's gains likely came from outside these established markets. She attributes the company's recent growth to sales in its home country of China as well as India, the Middle East and Eastern Europe. "It's a very dynamic [industry]," she adds. "It might be a different story [next quarter]."

Read Online for More Information