Crunch time for worldwide mobile phone shipments as economic crisis hits

Peter Dinham
Thursday, 12 March 2009 18:11

IT Industry - Deals

Almost daily there’s more news about the devastating impact the worldwide economic downturn is having on all business sectors, including the technology industry where the latest report reveals a big drop in mobile phone shipments.

In the latest tale of woe, the worldwide mobile phone market has copped the full effects of the economic crisis with shipments in the fourth quarter of 2008 falling 11.6% year over year, the first time the quarter has not recorded double digit growth in seven years. The fourth quarter fall was despite the market in 2008 growing by 4.3% over 2007.

And the news for this year is not any better, with IDC in its latest market report predicting a very rough 2009 with shipments of mobile phones forecast to be down by 8.3 %.

IDC says that, as consumer spending has dropped, handset manufacturers and mobile operators have reduced supply on hand, which has left chip vendors with increased inventory.
 
“Inventory management has had a dramatic impact on shipments, but consumer demand is not falling as fast,” according to Ryan Reith, senior research analyst with IDC's worldwide mobile phone tracker.

“Large chip vendors have been working to restructure inventory levels over the past couple of months to deal with the expected downward year and should see some stabilisation once inventories are reduced.”

The IDC report found that mature regions such as Japan, the United States and Western Europe all face tough times, with predictions of shipment declines ranging from -24.6% to -12.4% throughout 2009.
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