China cellphone sales rise 14 pct in 2004 - Gartner
Wed Apr 13, 2005 05:41 AM ET
SHANGHAI (Reuters) - China's mobile phone market grew 14 percent last year, as global giants Nokia and Samsung fought back against a field of stumbling domestic players, data released on Wednesday showed.
Mobile phone makers sold 68 million units last year in China, the world's biggest market, accounting for about 12 percent of global unit sales last year, according to Gartner.
Nokia, the world's biggest cellphone maker, saw its market share grow to 19.7 percent last year from 15 percent in 2003, overtaking market leader from Motorola Inc., whose share dropped to 12.1 percent from 17 percent.
Samsung retained the number-three position, rising to 11.9 percent from 10.5 percent.
The nation's biggest domestic player, Ningbo Bird Co. Ltd., saw its share drop to 8.6 percent from 10 percent, while the number-two domestic firm, TCL Communication Technology Holdings Ltd., fell to 7.2 percent from 9.7 percent.
Bird, TCL and a field of other domestic players posted steady gains against the foreign companies, boosting their collective share to 40 percent of the market in 2004 from just 4 percent five years before, according to Gartner.
But the foreign companies have fought back, introducing a new range of cheap models aimed at the market spectrum where domestic players had made major inroads.
TCL has been hit especially hard in recent months, with its domestic cellphone sales down 77 percent in February this year and down 10 percent in January, according to monthly company data.
Fierce competition in the sector, along with the expected entry of several newly licensed players, including Huawei Technologies, China's biggest telecoms equipment maker, is expected to result in an industry weed-out in the next two years, said Gartner analyst Ann Liang.
"New entrants will bring strengths to the market, but also more overcapacity," she said. "Consolidation is inevitable and the survivors will shape industry growth."
She estimated that only 25 to 30 of the industry's current 37 vendors would still be active by the end of 2006.
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