Global mobile sales up 30pc


2 Mar 2005

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

A traditionally strong fourth quarter drove a 30pc increase in global mobile phone sales during 2004, with a total of 674 million units sold during the year, according to Gartner.

“The market exceeded even the most optimistic forecasts in 2004. Strong replacement sales, seasonal dynamics and continued growth in emerging markets, especially Latin America, delivered the highest sales volume ever recorded,” said Ben Wood, principal analyst for mobile terminals research at Gartner.

After a tough start to the year, Nokia rebounded with a fourth quarter 2004 market share of 33pc. “Nokia stabilised its market share at the end of 2004 after the challenges of the first two quarters where it dropped to 28.8pc,” Wood said. “Its broad portfolio of devices combined with its profitable high volume low-tier products will help sustain this position in 2005, but it must regain the initiative in terms of brand and technology leadership in the face of strong competition from other top five vendors.”

In the fourth quarter, Motorola regained its second position ahead of Samsung with higher-than-expected growth. Motorola’s revitalised brand, due largely to the positive reviews of the RAZR V3, helped lead strong sales in Europe and North America. This was combined with aggressive pricing in emerging markets, particularly in Asia Pacific and Latin America.

Samsung increased its brand awareness in 2004, particularly in China, and it also demonstrated market leadership in some areas such as multi-mega pixel camera phones. Gartner analysts said Samsung will need to change its strategy and expand its product portfolio into the high volume, lower margin segment if it is to challenge Motorola and Nokia.

In western Europe, strong Christmas sales combined with aggressive pricing (both on hardware and promotional contracts/calling plans) helped sustain sales momentum. Other than price, color screens, cameras and fashion/design remain the key sales drivers in this region.

The North America market has been led by replacement sales. Generous promotions offering multiple free handsets on family price plans and declining prices for colour/camera phones fuelled growth.

In the Asian-Pacific region, replacement sales played a significant role in more mature markets such as Australia, Hong Kong and Singapore remained buoyant with competition in Hong Kong intensifying further. In China, mobile phones with color displays and camera phones continued to grow. GSM sales accounted for 85pc of total sales due to competitive pricing and focus on low-tier market by China Mobile. Overall mobile phone sales in Japan declined in 2004.

Latin America ended 2004 with strong sales in the fourth quarter. Almost 19 million new subscribers were added in the fourth quarter, with more than seven million subscribers in Brazil.

The momentum built in 2004 will continue into 2005 as Gartner forecasts worldwide mobile phone sales to exceed 730 million units. While the mobile phone market will continue to grow, Gartner analysts said vendors will face challenges in 2005.

“In mature markets, it remains to be seen whether the record breaking levels of replacement sales can be sustained,” said Hugues de la Vergne, principal analyst for mobile terminals research at Gartner. “In emerging markets the major battle ground in 2005 will be the sub US$50 handset arena.”

By John Kennedy