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Sony-Ericsson warns of handset slump

Sales falling out of bed

Sony-Ericsson warned today that it expects to sell just 14 million mobile handsets in the first quarter of 2009.

That compares to 24.2m in the fourth quarter of 2008, which was in turn down 21 per cent on the same period a year ago.

The joint venture expects average selling price to be down slightly to €120 and margin to also fall.

Sony-Ericsson thinks it will lose between €340m and €390m in the quarter, excluding restructuring charges of between €10m and €20m.

The news is likely to strengthen rumours that the joint venture is heading for splitsville. Of course this rumour has been around forever, but yesterday's reports claimed Sony was looking for funding to buy Ericsson out.

The joint venture releases its first quarter results on 17 April.

In not unrelated news, a survey of 2,000 US consumers found 39 per cent, or 60m US citizens with contract mobile phones, are likely to either switch to prepaid phones or reduce spending on extras like data services.

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