Mobile phone sales will shrink next year as consumers cut spending, according to a Reuters poll, while analysts are increasingly concerned about unsold phones piling up in stores.
On average, the poll of 36 analysts shows global market volumes shrinking 6.6 percent next year and 5.7 percent in the fourth quarter — traditionally the strongest period for the industry due to holiday sales. Forbes says mobile phone sales are down 58% in Japan.
In a similar poll in early November analysts on average forecast the market to rise 2.6 percent in 2009.
But since then Nokia, the world’s top mobile phone maker, has warned twice on market growth, saying on December 4 its best guess was for sales to fall 5 percent or more next year.
- CCS Insight, for instance, is predicting -3% year-on-year (YOY) growth for the fourth quarter of 2008 and -6% YOY for the first half of 2009.
- Informa Telecoms & Media’s November 2008 “Future Mobile Handsets” report, expects revenues from smartphone sales will represent over 55% of the total market value in North America, Western Europe and Japan. Informa predicts these markets will make up about 60% of global handset market value by 2013.
In order to offset creaking ARPU, operators have started turning their focus to non-voice services, with mobile broadband becoming a big hit for them, says RCR News.
Consumer electronics demand has slumped in the run-up to the key Christmas sales season, triggering the loss of 16,000 jobs at Sony Corp and profit warnings from Samsung Electronics and Texas Instruments.
Analyst estimates for 2009 range from a market contraction of 13 percent to growth of 3 percent. Only two analysts polled expect growth next year.
“A 5-10 percent decline is the best guess at the moment,” said Nordea analyst Martti Larjo. “This can move either way: if the economy continues to go downward the numbers could be worse. But while growth is not impossible, it’s unlikely.”
The $190 billion handset market had a brief shock in 2001 when the market fell 6 percent, its only contraction thus far.
The two largest vendors, Nokia and Samsung Electronics, are set to exit 2009 stronger than before, increasing their market shares to 39.6 percent and 17.3 percent respectively. LG is expected to sell fewer phones next year, but grab the No 3 spot in the market from Sony Ericsson.
