Nokia Oyj's share of the mobile phone market dropped below 30 percent in the third quarter as unbranded phonemakers in China expanded to other emerging economies, researcher Gartner Inc. said.

The Finnish company's share of sales to end users was 28.2 percent, from 36.7 percent a year earlier, the Stamford, Connecticut-based researcher said today in a report. The top 10 phonemakers' combined share fell to 67 percent from 84 percent.

Samsung Electronics Inc. and LG Electronics Inc. declined in market share while retaining their second and third place standings. Global smartphone sales surged 96 percent in the quarter, helping Apple Inc. At the low end, so-called "white box" factories in China grabbed share in India, Russia, Africa and Latin America as well as in their home market.

"This phenomenon will not be short-lived," Carolina Milanesi, an analyst with Gartner Inc.'s unit in Egham, England, said in the report. The white-box manufacturers "are having a profound effect on the top five mobile handset manufacturers' combined share."

Apple joined the top five vendors, edging out Research in Motion Ltd., Sony Ericsson Mobile Communications Ltd., and Motorola Inc. as smartphone sales almost doubled, reaching 19.3 percent of all handset sales. Nokia also sold more expensive phones to some consumers, helping margins, Gartner said.

Taiwan's HTC Corp. and China's ZTE Corp. and Huawei Technologies Co. rounded out the top 10 vendors.

Eoin Treacy's view A debate developed at the recent Chart Seminar about the mobile phone market with delegates comparing Apple to Research in Motion on an absolute and relative basis. Apple has been a clear leader in the sector over the last few years as the iPhone has become ubiquitous. However, while the barrier to new entrants is high, some such as HTC are partnering with heavyweights such as Google and beginning to make inroads. Just about every company in this sector appears to be involved in litigation, alleging patent infringement, which demonstrates just how competitive the business is. I thought it might be instructive to review handset producers in order to separate the winners from the losers.

Apple remains in a relatively consistent uptrend. Reactions, which have been relatively similar sized, have been limited to ranging consolidations; allowing a steady unwinding of overbought conditions relative to the 200-day MA. A sustained move below the MA, currently near $263 would be required to question the consistency of the medium-term uptrend.

Samsung Electronics has been consolidating above the previous high near KRW700,000 for the last year and is currently testing the upper side of the range. A sustained move above KRW850,000 would reassert the medium-term uptrend and confirm a return to demand dominance.

LG Electronics found support above KRW90,000 from July and rallied impressively from the lower side of the range last week. It is now testing the upper side and a sustained move below KRW100,000 would be required to question potential for some additional higher to lateral ranging.

Nokia appears to be in need of a catalyst to avert a continued decline. It retested the 2009 low in June and has had a downward bias since October. A sustained move above €8 would be required to question scope for continued lower to lateral ranging. Research in Motion has performed somewhat better recently but otherwise has a relatively similar pattern. Both Ericsson and Motorola are also laggards and remain largely rangebound within developing base formations. They will need to sustain moves to new recovery highs to indicate a return to demand dominance.

On the other hand, HTC broke out of a four-year range in September, consolidated briefly above TWD600 and continues to post new highs. The share is becoming increasingly overextended relative to the 200-day MA, but a sustained move below TWD700 would be required to question medium-term upside potential.

ZTE Corp rallied impressively from the 2008 lows to peak near HK$35 in January. It continues to consolidate below that level and recently found support in the region of the 200-day MA. A sustained break above HK$35 remains a requirement to indicate a return to medium-term demand dominance. Huawei Technologies Co. is privately held.

The clear leaders from these charts are Apple, Samsung Electronics, HTC and ZTE. At less that 10% Apple's market cap HTC through its partnership with Google and Microsoft appears to have solid medium-term growth potential. From an investment perspective, while the share is currently overbought it may provide a more attractive entry point following the next reversion towards the mean, defined by the 200-day MA.