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VIRTUALISATION Global mobile phone market in freefall
VIRTUALISATION Global mobile phone market in freefall | Global mobile phone market in freefall |
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| by Stan Beer | |||||||||||||||||||||||||||||||||||||||||||||||||
| Friday, 06 February 2009 | |||||||||||||||||||||||||||||||||||||||||||||||||
  
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The poor result for the mobile handsets market reflected an overall weakening of the market for consumer technology in general during a disastrous final quarter of 2008. "The fourth quarter was the perfect storm of factors to produce this result," said Ramon Llamas, senior research analyst with IDC's Mobile Devices Technology and Trends team. "A combination of weak end-user demand, currency volatility, and limited credit availability prevented the market from experiencing the usual seasonal increase in shipments. We expect the first half of 2009 to be very challenging as vendors and distributors grapple with clearing inventory. Should these conditions persist, the mobile phone market may not recover until later this year, and possibly not until 2010." If there was one highlight in 2008 it was that the converged mobile devices segment (commonly referred to as smartphones) grew 22.5% over 2007, clearly outpacing the rest of the industry. "In mature markets, such as North America and EMEA (Europe, Middle East, Africa), the converged mobile device segment grew 70.1% and 25.0% respectively in 2008," said Ryan Reith, senior research analyst with IDC's Mobile Phone Tracker. "This segment is unique and unlike the rest of the market. Data attachment rates for these devices is well beyond that of traditional mobile phones, and the devices and services catering to this segment were more readily available than ever before in 2008. As long as operators are able to continue to subsidize these devices, and developers continue to enhance applications, then this segment will be a silver lining to an otherwise gloomy market." According to IDC, there are clear expectations that 2009 will be more difficult than 2008, and handset vendors, chipset manufacturers, and operators will all have to work in sync to rebuild consumer interest in mobile spending. "Vendors are not taking this situation lightly, and are undertaking plans to run lean and maintain user interest," added Llamas. "Cost reduction and operational efficiency have become cornerstones to corporate strategy moving forward and, for some, that can include headcount reduction. At the same time, converged mobile devices and services will become primary targets for vendors to focus their resources. Most vendors have already signaled their intentions to concentrate on the hot converged mobile devices space by aligning with operating systems that fit their strategy. Services, meanwhile, have played only a small role in the overall market, but will see increased importance as vendors compete for the user experience." Top Five Worldwide Mobile Phone Vendors, Shipments, and Market Share, Q4 2008 (Units in Millions)
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