Handset market updates

Market Research firm Gartner has released some figures for the mobile handset market place. It is forecasting 1.28 billion units to hit the market in 2008; a growth of 11% relative to the 1.15 billion units sold last year. A For the first half of 2008, c. 600 Million handsets have hit the market. We are however set to see a moderate improvement for the second half of the year, and this will very much depend on the last quarter where seasonality and new product introductions are a sales booster.

Whereas the overall market is growing, maturing regions such as Western Europe, Japan and to a lesser extent the United States will continue to pose a challenge. And, growth will increasingly come from emerging markets; e.g. Asia Pacific market will reach 472.5 Million units an increase of 17.9 per cent. Contrast this with 188 Million handsets forecast in Western Europe a decline of 1.5% vs. 2007. More Shocking is Japan with 47.7 Million handsets a decline of 9.1% over 2007!

We have seen members on gsmExchange, increasing their trading activities in Asia, the Far East and the Middle East, as well as Latin America. And this has largely compensated for declines in other markets.

However, the business environment for handset manufacturers will continue to be difficult for two reasons:

1. In such a maturing marketplace, network operators are seeing their service revenue under pressure, and will want to control their costs by putting pressure on their handset suppliers.
2. New entrants such as Apple with its very successful iphone on the one hand, and more conventional consumer electronics manufacturers on the other continue to be attracted by the sheer size of the market. Not to mention low cost OEM's from China.