Feeds

Cellphone shipments grow up to 49 per cent in Q1

Not necessarily good news for the biz

  • alert
  • submit to reddit

Designing a Defense for Mobile Applications

Sales of mobile phone handsets grew by double-figure percentages in key regions during Q1, market watcher Strategy Analytics has reported.

However, that's not necessarily good news for cellular network providers, handset vendors, or handset component makers, research from In-Stat/MDR suggests.

SA's numbers show that GSM handset shipments grew 13 per cent year-on-year during Q1, with Nokia not only retaining but increasing its leading market share. It saw 18 per cent shipment growth during the period. But its profitability increased just two per cent year-on-year.

The CDMA market, meanwhile, grew 49 per cent over Q1 2002, largely thanks to high demand in the Americas, SA said. Samsung and LG were the winners here, recording 41 per cent and 81 per cent year-on-year shipment growth, respectively.

"Shipment growth does not equal profitability," said Chris Ambrosio, director of SA's Wireless Device Strategies Service. "With the exception of Nokia, vendor profits were flat or declining. Shipment growth for the top six vendors was slightly faster than the market rate at just under 19 per cent, but profits grew only three per cent.

"Vendors still have a long way to go in improving internal efficiencies, and in developing and commercialising diverse handset portfolios," he said.

Consumer acceptance is a problem too. As In-Stat/MDR notes, "while the number of handsets continues to increase, the vast majority of handsets sold each year are standard, voice-centric devices, and not the data-centric devices that service providers were hoping for".

That has a knock-on effect for component makers. In-Stat/MDR says is expects core handset semiconductor revenue to stay flat for the next few years, as falling component prices counter gains from increased sales. Across a broader timescale, 2002 to 2007, the company expects semiconductor revenues to fall by an average of just over three per cent.

That said, revenue derived from components providing extra functionality - Bluetooth, cameras, MPEG-4 playback, that kind of thing - will do better. In-Stat/MDR forecasts revenue from such "add-ons" to grow from $856 million this year to $1.7 billion in 2007.

But the add-on semiconductor market will never be larger than ten per cent of the core semiconductor market, suggesting that while add-ons will become more popular, prices will fall fast, and - more importantly - they're not going to redefine handset usage in any great way. ®

HP ProLiant Gen8: Integrated lifecycle automation

More from The Register

next story
Scotland's BIG question: Will independence cost me my broadband?
They can take our lives, but they'll never take our SPECTRUM
Auntie remains MYSTIFIED by that weekend BBC iPlayer and website outage
Still doing 'forensics' on the caching layer – Beeb digi wonk
Bring back error correction, say Danish 'net boffins
We don't need no steenkin' TCP/IP retransmission and the congestion it causes
NBN Co adds apartments to FTTP rollout
Commercial trial locations to go live in September
GoTenna: How does this 'magic' work?
An ideal product if you believe the Earth is flat
Samsung Z Tizen OS mobe is post-phoned – this time for good?
Russian launch for Sammy's non-droid knocked back
Telstra to KILL 2G network by end of 2016
GSM now stands for Grave-Seeking-Mobile network
Seeking LTE expert to insert small cells into BT customers' places
Is this the first step to a FON-a-like 4G network?
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.