(Corrects "sold fewer devices than expected" to "saw a decline in the number of devices sold" in paragraph 1, adds development in average selling price in paragraph 5, deletes erroneous bullet)
* Competition intensifies
* Shares down more than 3 percent
By Julie Astrid Thomsen
COPENHAGEN, Nov 9 (Reuters) - William Demant, the world's second largest hearing aid maker, said it would continue to focus on products that provide hearing quality rather than smart features, even as it saw a decline in the number of devices sold in the third quarter.
William Demant said it expects industry unit growth slightly below its target of 4-6 percent a year and its shares were down 3 percent at 181.60 Danish crowns ($28.38) 1302 GMT.
Following in the footsteps of market leader Sonova and Danish rival GN Store Nord, William Demant said last month it would launch a product that enabled users to stream phone calls and music from their hearing aids.
"Smart features don't sell hearing aids, but real user benefits for either our distributors or the end-user do and that is what we focus on," Chief Executive Soren Nielsen said.
Despite selling fewer hearing aids in the third quarter, the company saw average selling prices go up.
"Everyone wants to grow and the underlying market growth is insufficient. On the bottom line it's a zero-sum game and no business will survive by not winning market share," he said, adding that competition was tough.
Swiss Sonova earlier this year launched a new hearing aid microchip capable of streaming audio directly from wireless devices and now aims to compete on direct-streaming with a 2.4 GHz chip, which GN Store Nord was first to present years ago.
Danish peer GN Store Nord's shares fell more than 5 percent last week as weaker-than-expected quarterly revenue stoked fears that rivals were catching up with its technology.
"William Demant doesn't stand out from peers in any crucial way," Sydbank analyst Morten Imsgard said, noting that all producers now have technologies with small differences but none had entirely unique products.
Imsgard has a 'sell' recommendation for the shares.
$1 = 6.3984 Danish crowns Reporting by Julie Astrid Thomsen; Editing by Elaine Hardcastle and David Evans