Sorry, Google. The apps (and by that we mean appetizers) won out.

At long last there is proof of Google’s (GOOG)  long-anticipated smartphone. Late last week, the online advertising giant started handing out an Android-powered phone to employees. While refusing to detail the specs, the official Google mobile blog refers to it as a “mobile lab.”

The Googley vagueness continues on the blog, where it is described as, “A device that combines innovative hardware from a partner with software that runs on Android to experiment with new mobile features and capabilities.”

Of course, the gadget-obsessed immediately ran to the Federal Communications Commission to get those specs, and photos have been popping up all over. So, we now (mostly) know that it is a sleek-looking touch-screen phone made by HTC, powered by a high-end Qualcomm (QCOM) processor and featuring the latest Android 2.1 OS. From the looks of things, this GSM phone could operate on any number of networks abroad, but seems destined at least for T-Mobile in the United States.

With all the Googlers eager to show off their new gizmos, and this, the calendric peak of the holiday party season, it was inevitable that in the Bay Area at least, the two would combine.  Sure enough, a friend attending a holiday party over the weekend in San Francisco with a number of Google folks making merry was presented with the new phone. “Mostly, I wanted to see the photo of the engagement ring that was on it,” she says, requesting anonymity. “It wasn’t an iPhone, and besides, there were pigs-in-a-blanket and these really good mini-cheeseburgers, and I was hungry, so I didn’t pay too much attention. “ So there you have it.

Table stakes: iPhone quality hardware

Discounting for a moment that this occurred in gadget-jaded Silicon Valley (and that the mini-cheeseburgers were really good), it does offer a point worth examining. Great hardware is the minimum starting point in the smartphone market these days, and it doesn’t get anyone’s blood racing by itself. As a piece of hardware, the Google phone, dubbed the Nexus One according to employees, had better be on par with an iPhone. If not, as we have seen time and again with would-be competitors, it will be a non-starter.

Let’s assume Google’s phone is tip-top in the hardware department. What sells smartphones these days has as much to do with the software running the phone and the applications available as the hardware. Again, Apple (AAPL) leads the pack by a wide margin with its mobile apps store.

Google’s open-source mobile OS Android has been getting mostly good reviews, especially in its latest incarnation running on Motorola’s (MOT) Droid phone. What Google needs to do, however, is get more Android phones out there to attract more developers and get the critical application mass it needs.

What has everyone most excited at the moment is the (rumored) prospect that Google will sell its Nexus One as an unlocked, carrier-agnostic piece of gear starting in January. Fine, as long as the phone is still relatively cheap. If Google comes out with a $500 unlocked phone, it will fade as quickly as all of Nokia’s similar unlocked and pricey efforts.

But if Google sells its phone contract-free for the same $199 the iPhone sells for (with a two-year AT&T (T) contract) it will have a monster on its hands. How could that happen? Google, rather than a carrier could subsidize the phone, and make up the cost via mobile advertising (it just bought AdMob), or maybe just take a hit to build a market. Google can certainly afford it. Either way, Android gets very huge, very fast, and that is what Google really wants.

Would that upset Google’s roster of current Android customers, including Motorola, Samsung and some of the wireless carriers? Sure it would, but this isn’t about the old-school wireless ecosystem, it’s about the mobile Web and Google’s designs to own it. If Google wants it, it needs to step up. If not? Those pigs-in-a-blanket sure look good.

Apple's smartphone lands with a bang in Korea as pre-orders approach 65,000

Seoul iPhone launch. Photo: news.naver.com

After China's muted reception, Koreans greeted the launch of the iPhone Saturday in the style to which Apple (AAPL) has become accustomed. Hundreds of customers lined up, some as long as 26 hours in advance, to pick up the country's first batch of 1,000 iPhones amid helium-filled balloons, flashing strobe lights and a blaring rockabilly band.

According to the AP, KT Corp. (KTC), the country's second-largest carrier, had received an estimated 65,000 pre-orders — a number likely to loosen Samsung and LG Electronics' tight grip on the local mobile phone market. Between them, the two manufacturers (the world's No. 2 and No. 3 cellphone makers after Nokia), had sold some 400,000 smartphones in Korea at prices considerably higher than they charge in other countries.

In this market, the 32 GB iPhone 3GS — which KT is selling for $317 on a $38 per month two-year contract and giving away free with a $112/mos. contract — is a relative bargain. The Korea Times reports that Samsung has already lowered prices on some models in what looks like the start of a smartphone price war.

Korea, writes iPhonAsia's Dan Butterfield, "has a sophisticated group of consumers who are eager to take full advantage of iPhone’s superior user interface and application offerings."

And Apple was quick to show Koreans the flashy features only the iPhone can offer. Below: An iPhone ad already airing on local TV.

For video footage of the crowds and the countdown, see here.

See also:

• The iPhone is headed to Seoul
• China iPhone launch a 'disappointment'
• iPhone hardball and soft sell in China

[Follow Philip Elmer-DeWitt on Twitter @philiped]

Touchscreen phones are on fire, comScore reports, and Apple is leading the pack. For now.

Three months ending Aug. 2009. Source: comScore MobiLens

There's a thundering herd of imitators behind it, but Apple's (AAPL) iPhone still dominates that fastest-growing segment of the U.S. smartphone market, according to a comScore report issued Tuesday.

Touchscreen mobile phone adoption in the U.S. grew at a breakneck 159% rate last year, comScore reports, easily outpacing the 63% growth of the broader smartphone market.

By last August, nearly 34 million Americans were carrying smartphones, 23.8 million of them touchscreen devices. And of those touchscreen phones, 32.9% were iPhones.

“The iPhone clearly set the trend in the industry for touchscreen devices, so it’s no surprise that it has the largest share of the market,” said comScore VP Mark Donovan. “But as other players have entered the touchscreen market with compelling devices, competition is clearly heating up.”

Donovan mentioned Google's (GOOG) Android platform in particular, although the closest Android contender in August was the T-Mobile (DT) G1 running a distant seventh after two proprietary LG phones, the BlackBerry (RIMM) Storm, the Palm (PALM) Pre and the Samsung Instinct.

Below the fold, comScore's spreadsheets, including one that shows preference by age group. (The smartphone sweet spot seems to be ages 24 to 34.)

Our correspondent goes to a geekfest and reports back on five new tools you need now.

Catch that mouse. Logitech's Performance Mouse MX is one to love. Photo: Logitech

I was in gadgetry heaven.

The Pepcom Holiday Spectacular in New York Thursday night was buzzing — and it wasn't just the sensation of mobile devices on vibrate mode.

With 80 companies — from Hewlett-Packard (HPQ)  to Samsung — showing off their goods for the holiday season, the room pulsated with enthusiasm, competitiveness and innovation. It was like the recession didn't exist!

I can't go through everything I saw, but here are my top five picks of the most interesting, unique technology solutions for business (and then some honorable mentions).

Photo: Seagate

What: Seagate's Free Agent Dock Star
How much: $99. For external access, the first year is free, and then $29/year.
When it hits stores: October
Why it's cool: Usually, when a company rep tells me something is going to be a "game changer," I shrug it off, but I was thinking the same thing this time. Seagate (STX) has produced something incredibly simple for file sharing. All you need is an Ethernet connection and a storage device — of any brand — and you can pretty much share your files with anyone, anywhere. It doesn't matter the size or type.

Just think about that for a second, because it's pretty incredible. You just log into your account to access your storage device(s) and send your boss that huge file that's too big to attach in an email. Your boss will receive an email that says "click here," and it'll reroute her to the page where she can download those files straight to her desktop. It's that easy. With lingering concerns of cloud computing and network limitations, this might be the product that'll revolutionize the way we share files — both at home and at the office.

Photo: Pong

What: Pong iPhone cover
How much: $59.95
When it hits stores: Available now at pongresearch.com
Why it's cool: The debate of whether cell phone radiation causes cancer has been ongoing for years. Now after the advent of new technology from UCLA physics professor Alfred Wong, Pong Research has made an iPhone case that actually reduces the radiation transmitting to your brain by 60%. The cover basically bounces the radiation waves back into the air, away from you. It's the first Federal Communications Commission-certified product to do so.

Now some of you might question whether this will affect reception quality during all those important business phone calls. I made a quick 10-minute phone call with the cover on and the quality was normal, if not perfect. It's a hard case with the technology pressed on the inside cover, making it look like any other case. (It's available in black and lime green.) Considering how much cases for Apple's (AAPL) iPhone cost, this is a very competitive offer. And don't worry BlackBerry folks, a case will be coming your way in November — along with most smartphones next year if sales are good.

Photo: Duracell

What: Duracell My Grid
How much: $85
When it hits stores: October
Why it's cool: Basically, Duracell has made a charging grid that's compatible with the iPhone, BlackBerry and most Motorola (MOT) and Nokia (NOK) phones. From far away, it kind of looks like a solar panel. But a typical "grid" can hold four phones and all you have to do is attach a special clip onto your phone, and then you can throw your phone on there and the clip will create a conductive connection with the phone and start charging. Some phones will require an actual case, which you have to buy separately — which is a pain.

But it's still a good idea, especially if you have multiple phones in the household or at your desk and don't want to deal with tangled cords. The grid charges pretty much at the same rate as a regular charger and is even a bit more energy efficient since it's coming from one power source.

Photo: Logitech

What: Logitech Performance Mouse MX
How much: $99
When it hits stores: Available now
Why it's cool: Logitech (LOGI) has always been one of those companies that have produced solid computer accessories, from mouses to webcams. And now it's continuing to champion what it's known for by creating a mouse that actually tracks on glass. And here I thought its cordless air mouse was cool (it basically functions like a remote for your computer).

It is powered by the company's Darkfield laser technology; although the Darkfield seems like a necessary evolution in mouse technology, Logitech's attention to detail is what makes this product stand out. Take the programmable buttons that'll give you easy access to whatever you'd like. Or the adjustable scroll, which can move with clicks or can spin freely — making editing long spreadsheets all the more easier to navigate. There's also a mobile, smaller version of this product for $20 less, if you want a cheaper option.

Photo: Asus

What: Asus AiGuru SV1
How much: $269
When it hits stores: Available now
Why it's cool: The Taiwan-based company has made a seven-inch touchscreen video phone for Skype users. It's kind of clunky and is about a foot tall, but my goodness, it's a video phone! Asus says it's trying to target older folks who don't like messing with technology. But there's a strong possibility for business here, especially since more companies are making Skype-based phone calls for video conferences. Asus has to work on the video quality, for sure, but if it were to improve that and open up to other messengers in an different model, businesses could latch on.

Honorable mentions
What: HP 5310 Probook/Toshiba Portégé R600
How much: $699/ $2,099
When it hits stores: October/Available now

Why they're cool: HP debuted its new line of laptops for the holiday season that'll go with Windows Live 7 last night. It was a solid line-up as always. But the Probook was its notebook targeted specifically for professionals. With a 13.3-inch screen, it's only 3.7 pounds, 0.9-inch thin but yet has a full-performance processor. That's pretty cool. Considering the portability, I wish the battery life would have been more than six and a half hours, but it'll do. The coolest business feature is definitely the HP Quicklook, which allows you to sync your office calendar to your computer and edit at your convenience with a push of a button.

The other notebook worth mentioning is Toshiba's Portege R600. Now, unless a computer will cook and clean up after me, any price tag of more than $2,000 is absurd these days. Regardless, it was a neat product. At 2.4 pounds, Toshiba still managed to keep the optical drive in the unit. That's unheard of. It's under an inch thin, as well, and has a seven-hour battery life with a 12.1-inch screen. The two coolest features? It has no moving parts, and you can still see all your work even if direct sunlight is hitting the screen.

What: HTC Hero
How much: $179.99 with a two-year Sprint contract
When it hits stores: October
Why it's cool: It's been talked about for awhile, but this was the first time the HTC Hero has appeared in the public. It has a touchscreen interface that's similar to the iPhone (no keyboard), has a scroll wheel like the BlackBerry Curve and has a desktop that's reminiscient of the Palm Pre — not to mention it's running Google's Android. Could the HTC Hero be the love child of all other smart phones? Maybe, but it was user-friendly, has a full HTML browser (of course), a 5.0 megapixel camera and vibrates when you type, giving it a nice, simple tactile feel. And it was probably the most comfortably smartphone I've held, so it's got that going for it.

What: Jawbone Prime
How much: $129.99
When it hits stores: Available now
Why it's cool: Oh, the Jawbone. With a new line the company refers to as "ear candy" and a hefty price tag, it's obvious what kind of consumer Jawbone wants to appeal to. But it's a good product. The Prime is a sleeker version of the original Jawbone — now available in seven colors! The Jawbone Prime has improved sound quality and now reduces noise and wind. It's known to be uber comfortable, resting inside your ear instead of having to do that hook business and agitating your skin. What caught my attention was how it could connect to two phones, so you can easily switch from your personal to professional phone without having to take off your headset.

The way consumers use Apple's mobile phone (i.e., constantly) means big headaches for carrier AT&T. And more smartphones are on the way.

Randall Stephenson, chairman, CEO, and president of AT&T, holds up his Apple iPhone

At the South by Southwest music, film, and interactive fest in Texas earlier this year, the iPhone was all the rage — and not in a good way.

The device proved so popular with Internet-addicted attendees that AT&T's wireless network in the city of Austin buckled under the strain, all but shutting down both voice and data service for many customers.

iPhone users bashed the phone company on Twitter and in blogs, and AT&T (T) had to haul in extra network equipment just to ease the gridlock.

As it turns out, smartphones are double-edged swords for phone operators. They attract big-spending customers who purchase highly profitable text-messaging and unlimited-data plans.

But they also tax networks designed for simpler times. Now the wireless providers hawking those Internet-enabled mobile devices are experiencing the digital equivalent of being proprietors of an all-you-can-eat buffet: It seems like the perfect business until the sumo wrestlers show up.

No carrier is feeling the pressure more than AT&T, the exclusive U.S. provider of the iPhone. Users of Apple's device are the hungriest mobile Internet consumers of all: Not only do they send e-mail messages and access the web, they also view maps and YouTube videos and download iTunes purchases.

Independent telecom analyst Chetan Sharma estimates that the typical wireless subscriber consumes 120 megabytes each month; typical iPhone owners use four times that.

Accommodating all that data is one challenge for operators such as AT&T, but the real issue with smartphones is that their users are always moving from one location to another, tapping into the network constantly, sometimes for a few seconds, other times for hours on end. And when a big group gathers — the lunch crowd in Manhattan, say, or South by Southwest revelers — the effect can be total gridlock.

"3G networks were not designed effectively for this kind of usage," says John Donovan, AT&T's chief technology officer, referring to the current generation of broadband wireless. "We fight the day-to-day guerrilla warfare as the customers move around." Not that AT&T is complaining. "The iPhone," adds spokesman Mark Siegel, "is a problem that other carriers would love to have."

New data guzzlers
And they soon will — sort of. AT&T is in the hot seat now, but an influx of Internet-savvy phones could easily strain other carriers' networks in the near future. By 2010, global mobile data traffic is expected to exceed 200 terabytes per month, six times last year's levels, according to Cisco Systems.

Why? One reason is that other phonemakers are catching on to the touchscreen craze that made the iPhone a hit. Users of phones with Google's Android operating system spend roughly as much time online as iPhone users, according to mobile advertising company AdMob.

To date, only two devices use the Android platform, including the HTC myTouch 3G launched by T-Mobile (DT) last month. But Android phones from Samsung, LG, and Motorola (MOT) are due in stores by early 2010. The data-oriented Palm Pre, which operates on Palm's (PALM) WebOS platform, is already on Sprint (S) and should be in Verizon stores early next year.

With all the money AT&T and other carriers are making from smartphones, why don't they simply upgrade their existing systems to handle more traffic? Because increasing wireless capacity is like adding lanes to a road; it takes months or years to get local permission to build new transmission towers.

Ultimately all carriers will move to faster next-generation networks that are designed for data traffic. But those so-called 4G systems won't be available nationwide for years.

In the meantime, carriers are likely to get pickier about the applications they'll allow on their networks. When Apple (AAPL) unveiled the latest iPhone software in June, developers collectively groaned after the company revealed that AT&T wouldn't immediately support two of the most exciting (and bandwidth-hungry) new features: MMS, which uses the text-messaging system to send media such as photos and video, and tethering, which allows a phone to share its Internet connection with a nearby computer. (AT&T says MMS will arrive at summer's end, when the network is deemed ready.)

Some carriers may try to offload data traffic. PCCW, the Hong Kong operator, has started using Wi-Fi hot spots to ease the load from smartphones and its digital TV service.

Pricing will probably change too. In private meetings, AT&T CEO Randall Stephenson has said that the most active 5% or so of data users are causing problems for the other 95%. AT&T is working on a revamped data plan whereby light data users would pay less, and heavy users would pay a premium rate — or leave.

A few carriers in Europe already have moved away from unlimited-use data plans. And once one U.S. operator makes the move, it is likely the others will follow suit — and the sumo wrestlers of wireless might have to do without the buffet.

Wireless carriers tout a new wave of wireless technology but it will be years before most consumers benefit — and before carriers make money.

4G Phone: Samsung's Mondi device operates on WiMax networks. Image: Samsung

Verizon Wireless, a joint venture of Verizon (VZ) and Vodafone (VOD), last week announced it had completed data "calls" using its flavor of so-called 4G technology, a new generation of radio upgrades that promises to improve the throughput  and capacity of wireless phone networks.

Rival Sprint Nextel (S) immediately responded with a flurry of news releases touting its 4G network, which uses a competing technical standard.  In proclaiming its ability to deliver peak downlink speeds of 10 Mbps, one release gushed: "At these speeds, Sprint 4G breathes new life into wireless Internet."

Um, wasn't that what 3G was supposed to do?

Okay, that was a little harsh. But some analysts say the wireless carriers and their suppliers are hyping 4G technologies way before the services –and devices–are ready for prime time.

Indeed, many carriers globally still are building out their third-generation networks, and are only now starting to see returns on their investments, which included substantial payments for additional spectrum licenses.

3G all over again?

"Yay, Verizon made a test call on LTE," deadpans Jane Zweig, CEO of the Shosteck Group, a telecommunications consulting firm. LTE stands for Long Term Evolution, and it is the technology Verizon and many other incumbent phone operators are using to transition to yet another generation of broadband networks.

Zweig, whose firm has predicted that global wireless giant Vodafone won't make a return on its 3G investment (including spectrum) until 2013, sees 4G as a replay of 3G: a long, painful slog that will take many years to get up and running–and many more after that to produce financial gains for the carriers.

"Let's replay 3G," she says. "Where are the devices? What is it that people are going to do?  How much is the build out going cost? What's the resturn on investment. Is this a vendor dream or a carrier's nightmare?"

The carriers' 3G experience in the U.S. and abroad certainly offer clues as to how long it will take for 4G to become pervasive (and useful) to consumers.

When carriers started rolling out 3G systems in the early part of the decade–Japan's NTT DoCoMo (DCM) in 2001 became the first operator of a 3G network; Verizon followed two years later as the first major carrier in the U.S. to offer 3G–there was a lot of excitement (ample press releases, white papers and briefings by breathless executives) but not a lot for consumers to do with the network.

Some road warriors procured wireless data cards to hook their laptops up to the new network, but the first wave of 3G phones didn't offer much of a multimedia experience.

If you build it…

A few executives at U.S. wireless operators admitted at the time that 3G mainly allowed them to handle high volumes of voice calls at peak times. Not exactly what the futuristic data network was intended for.

Along came Apple's (AAPL)  iPhone: More than five years after 3G launched in the U.S. consumers finally had a device that showed them the power of mobile broadband networks. (Ironically the first iPhone ran on AT&Ts (T) less robust EDGE network, sometimes referred to as a 2.5G network.)

Other 3G devices started hitting stores, and today there's a real consumer case for 3G: almost a decade after carriers pledged billions of dollars to acquire wireless spectrum and build out networks. And, still, as Zweig and other analysts point out, 3G coverage in the U.S. remains spotty and service problems persist.

Will 4G help? Many operators (and the vendors that hope to sell them expensive new gear) are already touting 4G as the solution to issues of data overload they are now facing as consumers spend a growing amount of time downloading applications and doing heavy-duty computing on their mobile devices.

But as with 3G, fully formed 4G systems–the networks, the devices, the applications–are years away. Telecom executives like to quote the 1989 movie Field of Dreams: "If you build it, they will come." They'll come, alright, just not any time soon.

In a sign that should bode well for Apple's (AAPL) earnings in its third fiscal quarter — which ended Saturday — the MacBook has clawed its way back to the top of Amazon's (AMZN) bestseller lists.

The Mac, which once led the pack in the online retailer's Computers & PC Hardware Bestsellers category despite its $1,000 to $2,000 sticker prices, had fallen behind the blistering sales pace set by netbooks like the Asus Eee and the Acer Aspire One, which sell in the $300 to $400 range.

By June 1, the bestselling Apple computer on the list — a white plastic MacBook — had been pushed down to the No. 14 position.

But netbooks have started to fall out favor recently — as witnessed by reports of return rates as high as 30% and an NPD study that found that 60% of consumers who bought them didn't understand the difference between a netbook and a notebook.

Meanwhile, Apple announced on June 8 that it was refreshing its notebook line and lowering its prices. Result: its computers have become hot sellers on Amazon once again.

Apple's entry-level 13-inch unibody MacBook, renamed the MacBook Pro, has been one of Amazon's top 100 bestsellers for 20 days — basically since the moment it went on sale. As of Monday morning, it was the site's No. 4 bestselling computer overall and No. 1 in the laptop category.

In fact, three of the top 10 and five of the top 20 bestselling laptops on Amazon are now MacBooks.

Apple is not the only beneficiary of what some see as growing consumer disillusion with netbooks. HP (HPQ) Pavilions, Toshiba Satellites and Samsung Mini Notebooks are also selling briskly online.

See also:

• AMEX vs. Amazon; Macs vs. netbooks
• Amazon’s Christmas bestsellers: Acer, Apple and Asus

See the blue slice in the pie chart at right? It represents the iPhone's share of U.S. smartphone traffic on the network maintained by AdMob, one of the companies that run those little ads that appear on the screen of your mobile phone.

We've been watching that slice grow over the past few months. In February it covered 51% of the pie. By April it had grown to 59%. And by Thursday morning, when AdMob released the May edition of its U.S. smartphone pie, Apple's (AAPL) share had grown to 69% — a 10 point increase in one month.

Some caveats are in order. This is just one company's view of the mobile Web — albeit the view of world's largest supplier of mobile ads, serving 6.3 billion banner and text ads per month. And it's only a snapshot of the smartphones on the U.S. portion of the AdMob network — although 47.6% of AdMob's traffic comes from the U.S. and 37.3% of that comes from smartphones.

Still, what it suggests is that Apple's domination of the smartphone market — the only part of the cellphone market that has continued to grow in the face of the recession, according to Gartner Research — is accelerating.

How tough this makes it for the competition is even clearer when you look at AdMob's report on the total U.S. handset market — one that includes smartphones, so-called feature phones and devices that aren't phones at all, like the iPod touch. Apple's share of this market, viewed through AdMob requests, is 45.1%, having grown 10.4% between April and May. Most of the other players in the field — including Research in Motion (RIMM), Samsung, Motorola (MOT) and Palm (PALM) — are showing negative growth. We'll be watching next month to see if Palm's share grows once AdMob starts to get data from the Pre.

Below the fold: AdMob's worldwide data, in which Apple's share  (31.4%) and share change (5.2%) are smaller, but the pattern is basically the same. You can see the full report here.

See also:

• The iPhone casts a giant shadow on the Web
• iPhone now represents 51% of U.S. smartphone traffic – report

Apple's (AAPL) iPhone took first place in J.D. Power's 2009 smartphone consumer satisfaction survey released Thursday.

The iPhone ranked highest in every category except battery life, where it was tied for last place with Motorola (MOT).

Research in Motion's (RIMM) BlackBerry, by contrast, scored highest in battery life but ran with the middle of the pack in the other categories (physical design, ease of operation, features, operating system and overall satisfaction).

The survey was conducted between July and December 2008 among 2,648 smartphone users. Apple scored 791 on a scale of 1,000.

In a separate survey of 15,270 owners of traditional mobile phones, LG did best, followed closely by Sony Ericsson.

The iPhone's nearest competitors were two phones running on Microsoft's (MSFT) Windows Mobile: LG and Samsung. They were followed by HTC, running Google's (GOOG) Android. RIM, Palm (PALM) and Motorola brought up the rear.

Below: The smartphone consumer satisfaction summary. Individual scores below the fold.

Apple's (AAPL) iPhone was the fastest-growing smartphone of 2008, despite end-of-year sales that failed to maintain the blistering pace set in July with the launch of the iPhone 3G, Gartner researchers reported Wednesday.

"Apple's initial sell-through dropped significantly as sales fell during the fourth quarter," Gartner said. "Nevertheless, Apple maintained its third position in the global rankings."

Nokia (NOK) still dominates the worldwide smartphone market with a 43.7% share, but overall it was not a good year for the world's No. 1 manufacturer of mobile phones. Its smartphone sales were flat compared with 2007 and actually fell 16.8% year to year in the third quarter.

Research in Motion (RIMM), HTC and Samsung all grew their smartphone market share last year, but none as fast as Apple, whose sales increased 245%. See Gartner's table 2 below:

New products offering "compelling device experiences and touch interfaces" drove smartphone sales in 2008, according to Gartner research director Roberta Cozza — especially in calendar Q4. With no new iPhone to show in the December quarter, Apple's sales to end users fell 13.6%, to 4.08 million in Q4 from 4.72 million in Q3, as Gartner counts them. (Apple reported sales of 4.36 million iPhones and 6.89 million, respectively, in those quarters, but roughly 2 million iPhones built in Q3 ended up in inventory, according to Gartner, and therefore didn't count as sales to end-users.) Still, Apple's fourth quarter iPhone sales were up more than 111% year to year.

With two new BlackBerry models introduced in Q4, RIM's sales were up both year to year (84.9%) and quarter to quarter (28.3%). Samsung had a particularly strong quarter with sales up 138% year to year,  thanks in large part to its new touchscreen Omnia. See Gartner's Q4 2008 table below.

Below the fold: Gartner's tables for smartphone operating systems for the year 2008 and for Q4 2008.

Note: Google's (GOOG) Android operating platform is recorded in the Linux category, where it accounted for 20% of Linux smartphone sales in Q4, according to Gartner. Microsoft's (MSFT) Windows Mobile share includes smartphones sold by Samsung, HTC and others.