Handset sales will reach one billion in 2009 – Gartner

20 Jul 2005

In 2009 annual mobile handset sales will reach one billion, new research from Gartner suggests.

Gartner market data shows that worldwide mobile handset sales have been rising rapidly in recent years. In 1997, 107.8 million units were sold. By 2003, this number had reached 520 million. Sales will reach 779 million units in 2005, a 16pc increase on 2004.

In 2009, sales will exceed the one-billion mark. During that year, if Gartner’s projections are correct, one person in every 6.5 people on the planet will either purchase a phone for the first time or update their existing model.

“The world’s appetite for mobile phones has exceeded even the most optimistic expectations,” said Ben Wood, research vice-president for mobile terminals at Gartner. “Mobile phones could go on to be the most common consumer electronics devices on the planet.”

“The sales volume cannot be attributed to one region in particular. It’s a truly global phenomenon,” said Carolina Milanesi, principal analyst at Gartner for mobile terminals. “In mature markets such as Europe and North America, subscribers are still buying replacement phones. In emerging markets such as Brazil and India new customers are signing up for mobile services at an even faster rate.”

The Asian-Pacific region accounts for most sales: one in every four mobile phones sold this year. In 2009 this will increase to one in three. Ann Liang, Gartner’s principal analyst for mobile terminals in the region, said: “China and India alone will account for nearly 200 million units in 2007, with the Indian market surpassing China in 2009 to reach 139 million units.”

North Americans are still buying the latest models, but the bigger story is in Latin America. Hugues De La Vergne, Gartner’s principal analyst for mobile terminals in the Americas, said: “Sales nearly doubled in 2004 within Latin America and they will reach 100 million phones a year by 2009. Brazil is the powerhouse of the region, accounting for more than a third of sales this year.”

The research also predicts that more than 100 million 3G phones will be sold in 2006 and that more than 200 million smart phones – the fastest-growing category of device – will be sold in 2008.

“Smart phone sales broke all records in the first quarter of 2005 and we expect them to double year on year to 2006,” said Roberta Cozza, principal analyst at Gartner.

Despite spectacular growth on all fronts, there are some challenges ahead for the industry. Wood cautioned that while sales numbers were impressive, the big brands would have to deliver value as well as volume. “We expect the average wholesale price of a mobile phone will decline from US$174 in 2004 to US$161 in 2009. At the same time, phones will keep getting more complex and become ever-more packed with features. Only the sharpest players will survive.”

By Brian Skelly