A new report by market researcher Gartner shows smartphone sales eating into feature phone sales as consumers become more interested in their mobile phone's operating system and applications than mobile hardware.

Apple and Android were the biggest winners in the fourth quarter of 2009 said Gartner in their February 23 report. Both companies successfully managed to woo perspective customers with a wide range of useful applications, a versatile operating system and aggressive marketing campaigns.

Apple overtook Microsoft Windows Mobile to become the third biggest smartphone retailer with 14.4 percent of the market behind Symbian (46.9%) and Research In Motion (19.9%).

"Looking back at the announcements during Mobile World Congress 2010, we can expect 2010 to retain a strong focus around operating systems, services and applications while hardware takes a back seat," said Carolina Milanesi, research director at Gartner.

Overall the fourth quarter of 2009 was favorable for mobile phone manufacturers with sales across the board growing by 8.3 percent year on year to surpass 340 million units.

"The mobile devices market finished on a very positive note, driven by growth in smartphones and low-end devices," said Ms Milanesi.

"Smartphone sales to end users continued their strong growth in the fourth quarter of 2009, totalling 53.8 million units, up 41.1 per cent from the same period in 2008. In 2009, smartphone sales reached 172.4 million units, a 23.8 per cent increase from 2008. In 2009, smartphone-focused vendors like Apple and Research In Motion (RIM) successfully captured market share from other larger device producers, controlling 14.4 and 19.9 per cent of the worldwide smartphone market, respectively."

The full report can be read here: http://www.gartner.com/it/page.jsp?id=1306513