Apple has become the world's third largest smartphone supplier, despite offering its single iPhone product in just four countries so far.

New research from the analysts at Canalys predicts the smartphone market reached 118 million units in 2007, up 53% on 2006.

The 2,320,840 iPhones Apple shipped in the fourth quarter of 2007 equates to 6.5% of the smartphone market in that quarter, edging Apple above Motorola (2,301,260 shipments), in third place behind Research In Motion and Nokia.

"When you consider that it launched part way through the year, with limited operator and country coverage, and essentially just one product, Apple has shown very clearly that it can make a difference and has sent a wake-up call to the market leaders," said Pete Cunningham, Canalys senior analyst.

"What it must demonstrate now is that it can build a sustainable business in the converged device space, expanding its coverage and product portfolio. It will also need to ensure that the exclusive relationships that got it so far so quickly do not prove to be a limit on what it can achieve. Apple's innovation in its mobile phone user interface has prompted a lot of design activity among competitors. We saw the beginnings of that in 2007, but we will see a lot more in 2008 as other smartphone vendors try to catch up and then get back in front."

Nokia remained dominant with 60.5 million smartpohones sold. Blackberry maker Research In Motion secured 12.2 million sales, up 112% year-on-year.

Operating systems: Symbian dominates with 67% of the market, Microsoft has 13% and Research In Motion 10% of the market.

As prevailing rumours claim Apple will release new model iPhones later this year in order to stimulate sales, Canalsys offered a warning: "Experience shows that a vendor with only one smartphone design, no matter how good that design is, will soon struggle. A broad, continually refreshed portfolio is needed to retain and grow share in this dynamic market. This race is a marathon, but you pretty much have to sprint every lap."

Canalys estimates that Apple took 28% share of the fast growing U.S. converged device market in Q4 2007, behind RIM's 41%, but a long way ahead of third placed Palm on 9%. This was also enough to put Apple ahead of all Windows Mobile device vendors combined, whose share was 21% in the quarter according to Canalys figures.

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