iPhone sales nearly double during December quarter

Wolf calculated that iPhone unit sales soared by 97.9% year on year compared to generally impressive rise in smartphone sales of 37.2%. This was a distinct upturn from the previous four quarters during which smartphone unit sales rose by a more anaemic 5.6%.

Following Apple's impressive trail, were Research in Motion (BlackBerry), which climbed 41.2%, and Nokia, which enjoyed smartphone sales growth of 37.3%.

Wolf likened the fast growing smartphone market to a gold rush – lucrative and a free for all.

'Events since the beginning of 2010 have turned the market into a land grab not dissimilar to the California gold rush in the 1800s.

'Everyone is chasing the iPhone which has taken on an aura that far exceeds the phone's market share. The aura stems from the disruptive design and functionality of the first iPhone, and it has been reinforced by the remarkable success of the iPhone App Store,' Wolf wrote in a note to clients.

Wolf also predicted that Google and Microsoft will fight it out for a place beside Apple and Research in Motion. Windows Phone 7 could turn out to be an 'Android Killer' because Microsoft's latest smartphone OS is a sign that Microsoft 'finally gets it.'

'Microsoft has delivered on the necessary condition for success -- a smartphone operating system that should enable it to play in the same sandbox with Apple, Google and BlackBerry.

'We've frequently criticized Microsoft's inept efforts in delivering a user-friendly smartphone operating system. Such criticisms are now in the past,' Wolf wrote.

In Android's favour is the fact that is free to use, and there are few restrictions on handset makers in how they use it. For Microsoft, there is the company's strong position in corporate markets, according to Wolf.

Of course, Apple's lawsuit against HTC, and by implication Google is also prompting handset makers to consider alternatives like Windows Phone 7.

'A major battle between Microsoft and Google to win the hearts and minds of the smartphone vendors who are building devices for both platforms appears inevitable,' predicted Wolf.