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How the mobile phone market has evolved since 1993

The cell phone landscape today looks drastically different than it did three decades ago.

In 1993, Motorola accounted for more than half of the mobile phone market. But by 2021, its market share had shrunk to just 2.2%. How did this happen and how has the mobile industry changed over the past 30 years?

This video by James Eagle describes the evolution of the mobile phone market and shows the rise and fall of various mobile phone manufacturers. The data runs from December 1992 to December 2021.

The early days of cell phones

Motorola is known as a pioneer of mobile phones.

In 1983, the American company launched one of the world’s first commercially available mobile phones – the DynaTAC 8000X† The revolutionary analog phone cost nearly $4,000 and provided users with up to 30 minutes of talk time before needing a recharge.

Motorola launched a few more devices in the coming years, such as the MicroTAC 9800X in 1989 and the International 3200 in 1992, and quickly became a dominant player in the nascent industry. In the early days of the market, the company’s only serious competitor was the Finnish multinational Nokia, which had acquired early mobile network pioneer Mobira.

But by the mid-1990s, other competitors, such as Sony and Siemens, were beginning to gain a foothold, wiping out Motorola’s dominance. By September 1995, the company’s market share had shrunk to 32.1%.

Mobile phone market share by company % share (Sept. 1995)
Motorola 32.1%
Nokia 22.0%
Sony 10.7%
NEC 9.2%
Siemens 2.1%
Samsung 0.4%
Other 23.5%

In January 1999, Nokia surpassed Motorola as the largest mobile phone manufacturer, accounting for 21.4% of the global market share. That put it just slightly ahead of Motorola’s 20.8%.

One of the reasons for the rising popularity of Nokia was the great progress the company made in the field of digital telephony. In 1999, the company released the Nokia 7110the first mobile phone with a web browser

But it wasn’t just Nokia’s innovations that stood in the way of Motorola. In 1999, Motorola went through hard times after one of its spin-off projects called Iridium SSC filed for bankruptcy. This put enormous financial pressure on the company and it eventually laid off a large part of its staff after the project failed.

From then on, Motorola’s market share fluctuated between 14% and 20%, until Apple’s iPhone launched in 2007 and revolutionized the mobile phone industry.

The rise of the iPhone

Things really started to change with the launch of the iPhone in 2007.

In a keynote presentation at the San Francisco Macworld Expo in 2007, Steve Jobs presented the iPhone as three products packed into one device: a touchscreen iPod, a revolutionary mobile phone, and an Internet communications device.

A year later, Apple launched the App Store, which allowed users to download applications and games on their iPhones. Not only did this vastly improve the functionality of the iPhone, but it also enabled consumers to customize their mobile devices like never before.

This was the beginning of a new era of smartphones – an era Motorola couldn’t keep up with. Less than two years after the iPhone’s launch, Apple had captured 17.4% of the mobile phone market. In contrast, Motorola’s market share had shrunk to 4.9%.

By the end of 2021, Apple controlled about 27.3% of the global mobile market. The iPhone is an important part of the growth of the tech giant, the driving force behind more than 50% of the company’s total revenue.

A failure to run

While a number of factors contributed to Motorola’s demise, many point to one central hurdle: the company’s inability to turn around.

The rise of the iPhone was the beginning of a new, software controlled era. Motorola had mastered the hardware-driven era but couldn’t keep up when the tides turned. And the animation above highlights other companies that haven’t adapted or kept up either, including BlackBerry (formerly RIM), Palm, Sony and LG.

But Apple is not alone. The popularity of Google’s Android mobile operating system has seen competitors such as South Korean Samsung and China’s Huawei and Xiaomi thrive, with each company gaining a strong foothold in the global mobile phone market.

In today’s fast-paced world, the ability to run is essential if companies are to stay competitive. Will today’s cell phone giants like Apple and Samsung stay on top? Or will other companies like Huawei catch up in the coming years?

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