"The figure is a record, beating the previous best performance of 8.02 million in 2004 and came despite almost 20 million mobile phones, or close to one for every person in the country"
(FYI: Market size by population clocks: U.S. 300,998,590; World 6,570,806,106)
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Mobile sales ringing up records
By Michael Sainsbury
January 19, 2007 06:00am
AUSTRALIA's love affair with the mobile phone continues, with 8.74 million new handsets shipped last year, a figure handset market leader Nokia believes could be bettered this year.
The figure is a record, beating the previous best performance of 8.02 million in 2004 and came despite almost 20 million mobile phones, or close to one for every person in the country, being in use according to figures released by the Australian Mobile Telecommunications Association.
Nokia Australia chief Shaun Colligan told The Australian he expected shipments of between 8 million and 9 million for 2007.
In 2005, 8 million phones were shipped, although Mr Colligan said it was common knowledge some handsets each year were later moved out of the country to other markets on the so-called grey market.
"We see style and form factor continuing to be a big influence in the market and 3G is starting to play a more important role," Mr Colligan said. "At Nokia, we have an absolute focus on multimedia offering music, images and content on our handsets."
While Mr Colligan would not comment on Nokia's market share, industry insiders suggest the company still holds nearly 50 per cent of the Australian market.
Motorola is in second place with 18 per cent, with Samsung and Sony Ericsson are battling it out for third position.
But, while handset sales are booming as customers upgrade to third-generation phones that offer better inbuilt cameras and MP3 music players, fierce competition is cramping revenues for network operators.
The network operators are losing more money each year in handsets as they continue to subsidise customers who sign up to one- and two-year contracts.
"There has been a noticeable pick up in mobile competition in the last few months, especially since Telstra launched its Next-G HSDPA network in early October, which was followed by HSPDA upgrades by Vodafone and Hutchison," Morgan Stanley analysts Andrew Hines and Sachin Gupta noted this week.
"We expect this will intensify further as carriers attract traffic on their new networks."
One strategy expected to help drive handset sales this year is Telstra's plan to close its regionally focused CDMA network as early as January 2008.
At June 30 last year, Telstra had 1.7 million customers on CDMA. In the past two months of 2006 only 14,000 CDMA handsets were shipped out of a total of 369,000 sold in 2007.
In a blow for Telstra, Nokia would not have a handset available for its NextG network, which is only one of two globally operating on the 850MHz spectrum band, until at least the second half of this year, Mr Colligan said.
He said that Telstra had rejected Nokia's first 850MHz handset because it did not operate on the faster HSPDA technology Telstra was pushing as wireless broadband.
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