Cell phone market to grow 16% in 2007 - Gartner
engineeringnews.co.za
Continuing strong demand for new cell phones in Asia and Africa is set to lift 2007 global handset sales to 1,15-billion phones, a 16% rise from last year, researchers at Gartner said on Thursday.
That compares with an average market growth forecast of below 10% in a Reuters poll of analysts late last month after major handset makers reported January-March earnings.
Carolina Milanesi, research director for mobile devices at Gartner, said a major share of a large stock of older models at phone shops was sold in the first quarter, shoring up expectations for another strong growth year for cell phones.
The volume of sold mobile phones has grown at least 20 percent each year since 2002, helped by surging demand from emerging markets.
Gartner said 257,4-million phones were sold in January-March, up 14% year-on-year, boosted by 40% growth in the Asia-Pacific region. Western Europe and North America saw only 4% and 2% annual growth, respectively.
Market leader Nokia sold close to 92-million phones in the first quarter, giving it a 35,7% market share worldwide, compared with 33,9% a year earlier.
Gartner expects Nokia will continue to take advantage of the problems of its closest rival, Motorola Inc., in the quarters to come, helped by interesting new products, like "Barracuda," the Nokia 2630, and the Navigator.
In the first quarter, Nokia's market lead over Motorola hit its widest since 2003. Motorola's market share fell to 18.5 percent from 20.3 percent a year earlier, Gartner said.
The US company tried to shift older models at lower prices, resulting in a loss for the January-March quarter.
Motorola said late on Wednesday it expects to cut an additional 4 000 jobs as it continues to lower costs. It had earlier said it would cut 3 500 jobs by June 30.
"Second quarter should be slightly better. It shouldn't be as dramatic as we saw in Q1," Milanesi said. "Price adjustments are continuing."
Retailers sold 2 million more phones than Motorola shipped in the first quarter, Gartner said, but they were only able to clear some of the older phones from their shelves.
"There is still a few million phones lying around," Milanesi said, adding that the latter half of 2007 looked somewhat more promising than the first half, with products like Razr2 hitting the market.
Wider offerings of cheaper phones helped lift Sony Ericsson's market share to 8.4 percent in the quarter from 5.8 percent a year ago, and the wider portfolio is set to boost the handset vendors' sales further in emerging markets, Gartner said.
Korea's Samsung Electronics kept its 12.5 percent share of the market, helped by good demand for its advanced slim phones, while LG Electronics had 6.2 percent share of the market, slightly less than a year ago.
The smaller manufacturers, after the top five, sold 18.8 percent of all phones in the quarter, down from 20,9 percent a year earlier.
"Life is tough for tier-two and tier-three players. Biggest guys are getting bigger and economies of scale are playing increasingly bigger role," Milanesi said, adding that dozens of smaller cell phone makers have to either find their own niche or team up with other vendors. |
