Nokia is leading the smartphone race, shipping a record 21.4 million units (around twice that of its nearest competitor RIM) in the first quarter of 2010. As Android-powered devices move up the ladder and Apple continues to gain mainstream appeal as a mobile maker, market researcher Canalys explains why Nokia is still at the top.

Nokia is dominating the smartphone market thanks to aggressive pricing and a wider adoption of smartphone features in mainstream consumer phones.

"For the first time, touch-screens represented over 50% of Nokia's smart phone shipments this quarter, which were historically dominated by the keypad-based candy bar form factors," said Chris Jones, Canalys VP and Principal Analyst in a May 3 press release.

Nokia's "all-you-can-eat" Comes With Music subscription service has also seen wide appeal in China and India. The handset maker has been keeping a keen eye on developing markets, and targeting them with mid-tier smartphones to suit their budgets.

But it is not all good news for the mobile maker. "Nokia will need to deliver some strong and attractive product propositions in H2 2010 if it is not to lose momentum and risk falling behind in terms of innovation, as Apple, Google, RIM and Microsoft release updates to their respective platforms," reveals Canalys.

Nokia's nearest competitor, Research in Motion (RIM) also saw year-on-year growth (45.1 percent) in the smartphone market, but its market share is coming under increasing pressure from Apple. Apple's unit shipments have grown by just over 130 percent year-on-year, putting the company's market share at close to 16 percent of the smartphone market (compared to RIM's 19.2 percent).