The world is over the billion mark, that is the number of smartphones in circulation as of the September 2012 quarter, creating an impression that we are more digitally connected than in the previous decades, a new report said.

The real picture, however, is not that impressive, according to global research firm Strategy Analytics, adding that such seemingly incredible penetration was only achieved after 16 years have passed since the first modern smartphone hit the market.

ZDNet said Ericsson issued the first smartphone but according to PC Magazine, it was the Nokia Communicator which first broke the path for the now lucrative market in 1996, paving the way for the Finnish firm to sustain its mobile phone dominance for another decade.

Before the advent of phones that mostly deliver the same features and functions of a personal computer, Nokia held sway on the overall mobile phone industry, with its slew of feature phone models penetrating virtually all major markets and remaining as the preferred brand of global consumers until an event in 2007.

Apple unveiled the first iPhone, sparking a shake up that saw the tech giant snatching the smartphone crown from Nokia and in the process altering the worldwide mobile phone landscape, in which smartphones took the upperhand from feature phones, now slowly being phased out.

The new Strategic Analytics report showed that 1.038 billion smartphones have been snapped up as of September this year, coming from the 708 million units that were thought to be in active use in the same period in 2011.

The 12-month period jump, the report said, translated to 47 per cent rise in the number of smartphones that went online or roughly leaving a handset for every seven inhabitants of the world's total population.

It may appear a giant leap for the now ubiquitous communication tool but according to Neil Mawston, executive director for Strategy Analytics, big gaps remains to be filled "particularly in emerging markets such as China, India and Africa."

"Smartphone penetration is still relatively low ... most of the world does not yet own a smartphone and there remains huge scope for future growth," Mr Mawston was quoted by The Daily Telegraph as saying in the report.

What transpired during the past 16 years can be characterised as slow adaptation for the powerful gadget and it only gained considerable traction in the last half-decade, with analysts affirming that the leapfrog was mostly to smartphone innovations first delivered by Apple in iPhone and then by Google's Android handsets like Samsung and HTC.

Apple and Samsung, by the way, are now the leading players, toppling previous industry leaders such as Nokia and Research in Motion (RIM), maker of BlackBerry.

The pace of smartphone dispersion will speed up over the next few years, Mr Mawston said, adding "we forecast the next billion to be achieved in less than three years, by 2015."

And the race should fuel more innovation and fiercer competition for players to capture significant slice of a constantly expanding market that in 2011 was priced at around $US219 billion, Bloomberg said on Wednesday.