Windows Phone surpasses Blackberry for third place in smartphone shipmentsMay 16, 2013: 10:46 AM ET
Google's Android and Apple's iOS still make up the vast majority of the market.
FORTUNE -- There's a new number three.
Microsoft's (MSFT) Windows Phone operating system has overtaken BlackBerry (BBRY) for the first time, according to researcher IDC. The firm released its quarterly report on the smartphone market, showing that during the first quarter of 2013, Windows devices made up 3.2% of all smartphones shipped. BlackBerry devices accounted for 2.9% of the market. That is almost a perfect flip of the results in the quarter previous: Microsoft's OS then accounted for 2.6% of all shipments, and BlackBerry 3.2%.
Good news for Microsoft? Certainly. But one quarter change does not cement a definitive third-place operating mobile operating system. Both companies were once dominant in smartphones. Microsoft's earliest version of Windows for phones powered once-hot Palm devices. And just two years ago, Blackberry's keyboard-sporting devices enjoyed a 34% market share. Before Apple's iPhone came along in 2007, it owned 50% of the market. (What's more, RIM was once Fortune's Fastest Growing Company.) By 2014, the global smartphone market is expected to be worth some $150 billion, according to researcher MarkestandMarkets.
Both have desperately tried to gain momentum and lock themselves in as the third player, behind Google (GOOG) and Apple (AAPL). Combined, Android and iOS make up 92.3% of the market. Google's OS leads with some 75% of all smartphones shipped in Q1. On Wednesday, at is annual I/O developer conference, the search giant revealed that, in all, it had activated 900 million Android-powered phones, up from the 500 million announced last fall. Apple, which had its best first quarter ever with 37.4 million iPhones shipped, saw market share for its iOS dip to 17.3%.
To move beyond single-digit market share, Microsoft and Blackberry are going to need devices that can erode Google and Apple's enormous lead. Microsoft announced a strategic partnership with Nokia (NOK) in early 2011, which is bearing fruit, including the Lumia line of smartphones. (The two share development and marketing resources; Nokia abandoned its own proprietary system in favor of Redmond's.) Meanwhile, Blackberry -- which changed its name earlier this year -- has tried launching a new OS, Blackberry 10, alongside new devices. This week the company showed off additional hardware and said its BBM messaging service would come to rival platforms.
In a research report, Baird Equity Research praised both sets of moves but noted they were likely to have only modest consequences. "Our U.S.-based checks continue to suggest tepid demand for the Blackberry Z10 and Nokia Lumia devices," the report concluded. One thing is for certain, it's going to be a long fight to hold on to number three.