Bad news for cellphone vendors: sales in record decline

Stuart Corner
Friday, 01 May 2009 05:01

IT Industry - Strategy

Market Research firm Strategy Analytics says that global mobile handset shipments recorded their greatest decline in the industry's 27-year history: 13 percent between Q1 2008 and Q1 2009. IDC thinks the decline was even greater, almost 16 percent.

Alex Spektor, analyst at Strategy Analytics, said, "Global handset shipments fell to 245 million units during Q1 2009, down a huge 13 percent from 282 million units a year earlier. A global economic downturn and cautious de-stocking by retailers caused the slowdown." IDC put Q1 2009 shipments at 244.8 million, very close to the figure Strategy Analytics,  but had Q1 2008 numbers considerably higher at 290.8 million, hence the much bigger decline.

Neil Mawston, director at Strategy Analytics, said: "Shipment growth contracted for all the top five major vendors, forcing some of them, such as Nokia, to rein in costs and slash thousands of jobs. However, one bright spot was found among the smartphone specialists. Apple, for example, more than doubled its volumes year-over-year due to healthy demand for its wildly popular 3G iPhone."

According to Strategy Analytics, Apple shipped a better-than-expected 3.8 million iPhones worldwide in Q1 2009, up a healthy 123 percent from 1.7 million units in Q1 2008. In the touchphone stake's Apple's 3.8 million iPhone shipments exceeded those of one of its main touchscreen rivals, the Nokia 5800, which recorded slightly lower global volumes of 2.6 million units during the quarter.

(Nokia has been trying to drive home the company's ability to withstand the iPhone phenomenon. CEO Olli-Pekka Kallasvuo hailed the Nokia 5800 Xpress Music devices as a "great success", saying: "We estimate that this smartphone alone accounts for around 20 percent of all touch screen devices sold worldwide.)

And among the 'Big Five' vendors, Samsung was the stand out performer "Samsung's global market share hit an all-time high of 19 percent. Its success has been driven by an attractive portfolio of handsets for the high-growth touchscreen and QWERTY messaging markets.," according to IDC. IDC noted that Samsung had "returned to double-digit profitability to start the year, resulting from improved operating efficiencies and a favourable product mix for the quarter."

CONTINUED