Apple Inc's share of China's smartphone market slipped for a second straight quarter in the fourth quarter of 2011 amid competition from Chinese vendors and as some consumers delayed purchases to wait for the iPhone 4S launch.

China has not been an easy market for Apple, with the U.S. technology giant grappling with a lawsuit from a Chinese company over the iPad name and issues at its suppliers' factories over wages and working conditions.

In the world's largest mobile phone market, where the number of subscribers is set to hit 1 billion this year, there is keen competition from vendors such as South Korea's Samsung Electronics Co Ltd, and domestic players Huawei Technologies Co Ltd and ZTE Corp.

Chinese handset makers have been actively promoting their smartphones with China's three telecommunications operators, so we saw ZTE and Huawei gain significant market share, said Taipei-based analyst CK Lu at research firm Gartner.

Apple's market share fell to 7.5 percent in the fourth quarter of 2011, from 10.4 percent in the previous three months. Huawei's share rose to 12.6 percent, while ZTE's was up at 11.1 percent, Gartner data showed.

Samsung displaced Nokia Oyj as the top smartphone vendor in China during the fourth quarter, data obtained by Reuters showed.

China Unicom, the country's No.2 telecoms operator, is the only carrier to officially carry the iPhone.

The market expects the third and smallest operator China Telecom Corp Ltd to be next to clinch a similar deal with Apple later this year.

(Editing by Chris Lewis)

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