Over 6.6 billion mobile phones will be in use by the end of 2017, according to CCS Insight's latest market forecast (www.ccsinsight.com). Two-thirds of them will be smartphones, up from less than 25% in 2012, according to the research group.

In the first three months of 2013, smartphone shipments exceeded those of non-smartphones for the first time ever. Sales of smartphones have been helped by new, cheaper devices, especially, but not only, in emerging markets. The mobile and media analyst firm expects 1.86 billion mobile phones to be shipped in 2013, of which 53% will be smartphones.

The blisteringly fast growth of smartphones in Western Europe and North America will see penetration levels approaching saturation point in these markets within three years, according to CCS Insight. More than 50% of the mobile phones in use in these regions are already smartphones. CCS Insight predicts this figure will grow to more than 80% in 2015. Beyond 2015, much of the growth will come from emerging markets.

At the same time, sales of tablets are rising at a staggering rate. Altogether, global shipments of smart mobile devices (smartphones and tablets) will increase 2.5 times between 2012 and 2017, to reach 2.1 billion units. CCS Insight predicts that by 2017 the combined number of mobile phones and tablets in use will exceed the world's population.

Despite the strong growth there's no room for complacency, says the research group. Even dominant operating systems like Apple's iOS and Google's Android will face challenges.

"Having defined the modern smartphone era, Apple is struggling to keep up with overall smartphone market growth, particularly as that growth shifts toward emerging markets," Marina Koytcheva, director of forecasting at CCS Insight, says. "Apple will have to choose between sustaining its profit margin and holding onto market share. Android on the other hand is highly dependent on Samsung. As profit margins are squeezed Google will need to ensure Android remains a viable choice for other phone-makers."

CCS Insight points out that competition won't stand still either. Koytcheva says Microsoft desperately needs to make an impact in smartphones as the PC market shows no sign of leaving the doldrums. Similarly, BlackBerry seems determined to remain a relevant competitor. When it comes to smartphones it's not just about competing software platforms.

"Giving phone users the next generation of communication technology is going to be critical," says Koytcheva. "Mobile network operators are investing huge sums in 4G technology and are pushing hard to get 4G-enabled phones into people's hands."

CCS Insight expects sales of 4G devices to grow tenfold between 2012 and 2017, to 650 million units, with almost half of them going to emerging markets in 2017.