Global mobile phone sales increased by 16% in 2007 - Gartner

Worldwide sales of mobile phones to end-users surpassed 1,15bn units in 2007, a 16% increase from 2006 sales of 990,9m, according to Gartner. Mobile phone sales at the end of the year were consistent with the yearly trend, as fourth quarter sales reached 330m units.

"Emerging markets, especially China and India, provided much of the growth as many people bought their first phone," says Carolina Milanesi, research director for mobile devices at Gartner, based in Egham, UK. "In mature markets, such as Japan and Western Europe, consumers’ appetite for feature-laden phones was met with new models packed with TV tuners, global positioning satellite (GPS) functions, touch screens and high-resolution cameras."

"After another strong year, we expect the growth in sales of mobile devices to end-users will decelerate in 2008 and fall to about 10% growth as mature markets become more saturated," adds Milanesi. "However, the global mobile devices market will remain relatively immune to a recession in the US and Western European economies as the majority of growth in 2008 will come from emerging markets. The mature Western Europe and North America markets are driven by operator contract terms and replacement cycles and will account for just 30% of the global mobile devices market in 2008."

Nokia achieved its long-term target of 40% market share in the fourth quarter of 2007 when it sold slightly more than 133m phones across the world. Despite some component shortages, Nokia increased its market share sequentially in all regions except North America, which remains a challenging market for the vendor. In emerging markets, products such as the 1110, the 1600 and the 2630 were in demand by consumers, while in mature markets such as Western Europe high-end phones like the N95, N82 and N73 were sought-after devices. In 2008, Nokia will need to continue to improve its portfolio, offering not only more applications and functions, but also novel designs and improved user interfaces.

In the fourth quarter of 2007, Samsung maintained second position, and, although its market share slipped slightly, the gap widened between it and third-placed Motorola. Its success relied on its Ultra and Ultra II family of products. In 2008, Samsung needs to diversify its portfolio further with more form factors and colours so that single products stand out from the overall line-up.

The problems that beset Motorola in the third quarter of 2007 continued through the fourth quarter, and it recorded sales of 39m phones across the world, taking 11,9% of the market. It retained second place in terms of annual sales to end-users in 2007, largely thanks to the inventory it disposed of in the first half of the year. Nevertheless, the extent of Motorola’s troubles can be seen in the 9,7 percentage-points market-share drop in its fourth quarter of 2007 result from the same period in 2006.

Sony Ericsson ended 2007 with another positive performance, growing its market share on a quarterly basis to 9% from 8,7%. Its Cyber-shot and Walkman products, such as the K850i, K610i, W910i, K550i and W300i, remained popular among consumers around the world. As Sony Ericsson widens its reach, adding features such as Wi-Fi and GPS, as well as more low-tier products, it will stay competitive in the coming quarters.

LG’s mobile phone sales totalled 23,5m units in the fourth quarter of 2007, maintaining its 7,1% market share despite the increase of more than three million in sales volumes. The success of the Viewty, the Venus and the Voyager helped LG gain brand awareness across the world as well as improve its margins. Milanesi comments: "In 2008, LG will need to continue strengthening its high-end portfolio for mature markets as well as its mid tier. In the low tier, LG will increasingly be challenged by vendors such as ZTE, which has already been eroding its market share in key markets such as India."

The market saw three new entrants into the top ten in the fourth quarter of 2007. These vendors included Research In Motion (RIM), ZTE and Apple. "On one hand, we have aggressive pricing and a focus on emerging markets (ZTE), and on the other, RIM with targeted functions and Apple with brand and design," says Milanesi.

"Phone manufacturers need to continuously adapt their portfolios to respond to operators’ demands for open platforms, lower pricing and more personalisation," recommends Milanesi. "They should also try to meet consumers’ desires for fashionable, easy-to-use phones."

Source: http://www.computingsa.co.za/