IDC: New features drive continued handset growth

IDC: New features drive continued handset growth

Mobile phones are just about the only type of hardware still growing at a double-digit pace, and the future for the market continues to look bright as manufacturers bring data applications into voice handsets, according to research released by IDC.

Worldwide shipments of mobile phones grew 19.2 per cent in the second quarter of 2003, compared with figures for the second quarter of 2002, IDC said in a release. A total of 118 million units were shipped, led by Nokia with 40.9 million units.

The market for phones would continue to grow as new users discovered cell phones, and experienced users trade in their voice-only handsets for cell phones that provide email, Web browsing, and other data applications, IDC analyst, Alex Slawsby, said.

IDC cited the rise in shipments of phones with colour screens and digital cameras as one of the reasons for the continued strength of the market. About one-third of market leader Nokia's cell phones shipped in the quarter had colour screens and multimedia capabilities, and the company shipped an increasing number of camera phones as well, IDC said.

Motorola came second, shipping15.8 million units in the second quarter (13.4 per cent of the market). This represented a decline from last year's 17.4 per cent market share.

This could be attributed to strong competition in Europe and Asia from Nokia and third-place finisher Samsung Electronics, Slawsby said.

Samsung increased its market share in the second quarter to 10.1 per cent, shipping 12 million units, up from 9.5 million in the second quarter of 2002.

The company had pursued a very aggressive product strategy with numerous cell phone designs and the utilisation of its own components in its phones, Slawsby said.

The market for smart phones, or devices that combine voice and data capabilities, also grew substantially in the second quarter. Total shipments remain low as compared to the overall cell phone market, with 1.97 million units shipped in the second quarter, up from 456,601 units in the second quarter of last year.

Eventually, all cell phones would be smart phones, but it would take a few years to reach that point, Slawsby said. Early smart phones were really personal digital assistants (PDAs) with some voice capabilities built in as an application.

Users were much more interested in sleek devices in which voice was the primary function, and data capabilities were tacked on, he said. These types of devices were starting to make their way onto the market, and would enjoy increasing popularity in coming years.

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