Apple (APPL) iPhone And Samsung Galaxy Push Smartphone Shipments Above 1 Billion Last Year

Smartphone vendors shipped more than a billion devices last year, breaking previous records.

The increase is a 38.4 percent jump since 2012, according to quarterly data compiled by the International Data Corporation and released Monday. Some manufacturers created low-cost models targeted at emerging markets while others lured consumers with higher-end products.

Smartphones accounted for more than 55 percent of all the 1.8 billion mobile phones shipped worldwide last year. In 2011 only 494.4 million smartphones were shipped.

“Doubling that volume in just two years demonstrates strong end-user demand and vendor strategies to highlight smartphones,” said Ramon Llamas, a researcher from IDC, in a press release.

Samsung Electronics Co., Ltd. (KRX:005935), Apple Inc. (NASDAQ:APPL) and Huawei Technology Co Ltd (SHE:002502) are still the world’s three most popular phone companies.

“Among the top trends driving smartphone growth are large screen devices and low cost,” said Ryan Reith, director of the IDC’s mobile phone tracking program.

“Of the two, I have to say that low cost is the key difference maker,” he added, explaining that this low-cost portion of the market has been driving the volume.

“Markets like China and India are quickly moving toward a point where sub-$150 smartphones are the majority of shipments, bringing a solid computing experience to the hands of many,” he said.

Samsung is still the world leader in smartphone shipments thanks to global demand for its Galaxy and Note models, plus a wide selection of lower cost versions.

Apple is the second highest-ranked brand. In the fourth quarter of 2013 iPhone shipments broke records as the company opened operations in new countries.

Huawei saw the highest year over year increase of all the leading smartphone brands. Before 2013, the company had done a lot of “original device manufacturing” work (ODM) where they would create a product for other companies to sell. But last year, they changed their strategy and created more self-branded units, which helped their growth.

Lenovo Group Limited (HKG:0992)and LG Electronics Inc. (KRX:066570) also made the list of top vendors.

Lenovo’s phones cost less and are targeted at emerging markets, while LG’s Nexus and Optimus devices are more high-end, featuring bigger screens.