A new report from Informa Telecoms & Media shows that nearly 66 percent of mobile handsets sold in China were Android - making it the largest single market for Google's operating system.

That number represents a third of total global sales of Android smartphones, which in 2012 will reach 461 million units.

"Despite the economic downturn, the global smartphone market is enjoying healthy growth and consumers are actually spending more to acquire more technologically-advanced devices," said Malik Saadi, principal analyst at Informa Telecoms & Media. "It is estimated that around 786 million smartphone devices were sold in 2012 (including the devices powered by non-certified variants of Android that are proliferating in China), which is 45 percent more than the total number of smartphones sold in 2011."

Informa says that the explosive demand for Android is driving the growth for smartphones in China, which is the fastest growing market in the world for mobile phones representing a year-on-year growth of 85 percent in 2012. Apple is far behind with only 5 percent market share.

The company released its latest iPhone 5 handset in the country this month and reported sales of 2 million units in its opening weekend. However, Informa says that Apple is estimated to continue to lose market share to Android going into 2013 unless it creates a TD-LTE variant for the Chinese market.

Meanwhile, Nokia's partnership with China Mobile, the country's largest mobile phone carrier, will mean that the Finnish company could see its share of the Chinese market grow by 2 percent. That growth will largely be driven by its latest Windows Phone 8 smartphones.

Informa predicts a similar fate awaits Apple in the U.S. where Android already accounts for an 11 percent share. The research firm says that going into 2013, one in two handsets sold in the US will be powered by Google's operating system.

"With the continued rise of top-end Android devices, iPhone sales in the US could face significant challenges if Apple does not manage to make radical changes to its ageing iOS, particularly to the user interface," said Informa in a press release. "Although Apple has upgraded the hardware of the iPhone 5, only a little has been done on the software side. This situation could lead to even the most ardent Apple fans churning as they become disillusioned with using the same user interface framework for more than six years."

Overall Android is predicted to continue to grow, accounting for one in two handsets sold worldwide by 2015, peaking in 2016 following more aggressive penetration by competing operating systems such as Windows phones.