"Nokia is also transitioning from some very successful volume drivers, like the N95 and E65, to a number of successors, such as the flagship N96, and shipments of these new models have not yet ramped up," said Canalys analyst Tim Shepherd.

"And Nokia has taken time to bring a touch screen product to market in the wake of the iPhone's success, despite having had the experience of producing the Series 90-based 7710 four years ago. Conversely, vendors such as HTC with its Touch Diamond have capitalised on customer demand for this type of product."

With competition in the smart phone space heating up, the ability to introduce technology and user interface enhancements becomes critical for vendors, said Shepherd.

"You also need to be able to integrate them seamlessly into the device to provide a great total user experience. And that means having sufficient control of development of the operating system, which Apple and RIM clearly have already." Shepherd pointed out that Nokia's acquisition of Symbian should help it in this regard.

Motorola, currently holding onto fourth place in smart phones thanks largely to its Linux-based models, recently announced it would move away from using the Symbian OS and focus more on Android.