Samsung is set to become the biggest mobile phone maker in the world this year eclipsing Nokia, which has held the title for 14 straight years.
Samsung will end the year with a 29 percent share of global shipments, up from 24 percent in 2011, according to figures from IHS iSuppli published on Tuesday.
Nokia, which enjoyed a 30 percent share of all shipments in 2011, has seen its market share slide to 24 percent this year, the market analyst said.
The change signals something much bigger than a rivalry between two companies: the mass adoption of smartphones over more basic handsets.
Smartphones made up 47 percent of all mobile phone shipments in 2012, up from 35 percent in 2011, said IHS iSuppli. The trend is set to continue in 2013, when smartphones will make up more than half of all mobile phone shipments for the first time, the company forecast. Smartphone shipments in 2013 are expected to account for 56 percent of the market.
The smartphone market has seen strong growth ever since Apple's iPhone appeared and competitors, led by Samsung, began pushing out competing phones. While Apple managed to dominate the market for the first few years, Samsung has come on strong thanks to big improvements in the Android OS and a mass of phones aimed at all sectors of the market.
Together, Samsung and Apple accounted for just under half of the entire smartphone market. Their nearest competitors were Nokia, HTC and Research In Motion, which each had a 5 percent share, said IHS iSuppli.
Whether Nokia can claw back market share depends in a large part on the success of Windows Phone 8. The company chose not to adopt Google's Android OS and opted for one of its own - a strategy that failed and meant it missed out on much of the early growth in the smartphone sector.
Now it's allied itself with Microsoft and is one of the software company's key partners in rolling out Windows Phone 8. The OS has received a positive response from critics and the number of apps available for the platform continues to grow, but it's still too early to tell how successful it will become.
The coming year will also be an important one for Research In Motion, which will relaunch its BlackBerry OS with new handsets on 30 January.
Overall, IHS iSuppli said the global mobile phone market saw shipments of 1.4 billion handsets in 2012, up just 1 percent from 2011. Total smartphone shipments jumped from 483 million to 654 million handsets.