Mobile handsets suffer from saturated markets
By Robert Budden, Telecommunications Correspondent
Published: March 10 2002 18:39 | Last Updated: March 10 2002 18:59
<<COMMENTS: The heat is on to press for MMS working by next sales season Thanksgiving to Xmas 2002. Like I said: It is MMS or bust! Networks, Terminals and prosumer applications.>>
Mobile phone handset manufacturers suffered their first decline in sales last year, as new subscriber growth in the saturated markets of Europe ground to a halt.
Figures from Gartner Dataquest, the research group, reveal global handset sales last year reached 399.5m, a 3.2 per cent decline on 2000, the industry's best year for sales.
Nokia, the world's largest handset manufacturer, dramatically improved its dominant position, grabbing 35 per cent of the market, up from 30.6 per cent in 2000, mainly on the back of strong handset sales aimed at lower-end users.
Analysts are eagerly awaiting the launch of Nokia's latest handsets, to be unveiled tomorrow, to gauge whether its latest models are appealing enough for it to maintain its position.
But the real surprise story came from the Korean manufacturer Samsung, which increased its market share by 37 per cent with over 28m handset sales, led mainly by strong reception to some of its upmarket phones.
Analysts said some users, particularly in the youth market, were treating mobiles more like fashion accessories and were upgrading to top-end models. But overall there was a marked slowdown in replacement sales last year, according to Gartner.
"We do think people are looking to replace phones but they are looking for something to replace it with," said Ben Wood, senior analyst at Gartner. "We think the real impetus for people to change phones will come as more manufacturers launch handsets with colour and new applications."
But he said that even where sales had been disappointing, "sexy upmarket products remain great for brands. Manufacturers need top-end models to be aspirational to consumers."
Sales were also hit last year by the emerging second-hand market for handsets, particularly in eastern Europe, Africa and Asia.
A sharp reduction in subsidies on pre-pay phones also dramatically hit sales, a development which has hit smaller manufacturers such as Philips, Alcatel and Sagem which focus on the low-end market.
Sales of GPRS phones, the interim technology between 2G and 3G which allows users to download web information, were poor. Last year just 2 per cent of all handsets sold were GPRS phones. However, manufacturers are hoping this will increase this year as mobile operators roll out more data services.
The continued strength of European operators is good news for Symbian, which is battling with Microsoft to dominate the market in handset operating systems. Symbian has relationships with 70 per cent of manufacturers by market share, although Microsoft is slowly gaining ground through its link-up with Samsung. |
