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Q3 09 mobile phone shipments up from Q2

Posted: 09 Dec 2009     Print Version  Bookmark and Share

Keywords:Mobile communication equipment 

The worldwide mobile phone market saw mild sequential growth in the Q3 09, according to IDC's Worldwide Mobile Phone Tracker. Year-on-year growth remained negative, but improved from 1H 09. Mobile phone shipments totalled 28.71 crore (287.1 million) units worldwide in Q3 09, down 6.0 per cent from a year earlier, but up 5.6 per cent from Q2 09.

"The mobile phone market is showing the first signs of improvement since the onset of the economic crisis," said Ramon Llamas, senior research analyst with IDC's mobile devices technology and trends team. Llamas further noted that during the third quarter, the research firm saw a number of channels promoting older devices at significantly lower prices; this was enough to spur demand and push volumes higher. "Now that we have moved into the fourth quarter, vendors are setting the stage for further gains by launching their flagship devices to meet pent-up demand," he added.

"Although some regions are still reeling from problems associated with the economic crisis, the third quarter served to cleanse the channel while providing the signs of stability necessary for additional improvement in the fourth quarter," said Will Stofega, research manager of IDC's mobile devices technology and trends team. "Despite the outlook for a slower economic recovery, we think vendors should increase R&D spending as well as engage in a broad portfolio review in order to ensure the best competitive stance as the market recovers."

Scrutinizing each region
The North American market posted mixed results for Q3 09. The United States posted positive results, with converged mobile devices and prepaid handsets once again driving growth. Meanwhile, the Canadian mobile phone market declined for the third straight quarter despite double-digit converged mobile device growth. The tepid Canadian economy, shrinking traditional phone segment and inventory clear out by the largest service providers led to the market's weaker three-month performance.

The Latin American mobile phone market did not experience a strong recovery in Q3 09 as expected. Longer replacement cycles, anemic user demand and decreased handset subsidies in select countries all negatively affected shipment volumes during the quarter. Challenges are expected still as Mexico, one of the key countries in Latin America, will experience a "perfect storm" of tax increases for telco services, personal taxes and value-added taxes, which will all negatively impact handset sales.

The Western European market showed strong signs of recovery. For the first time this year, both traditional mobile phone and converged mobile device shipments increased year-over-year as well as sequentially. The price erosion from converged mobile devices and low-end handsets contributed to this vitality along with the new feature phones from LG and Samsung targeting mid-tier segments. In CEMA, the market continued to recover from the previous three months but was still depressed in comparison with a year ago. Nokia lost ground in converged mobile devices while LG gained on rivals with double-digit growth as total market volumes continued to decline.

Q3 09 was weaker than anticipated in the Asia-Pacific region, with total shipments down slightly from a year ago. Key emerging markets including China, India and Indonesia, all posted slight declines, signalling that recovery may take longer than expected. Still, demand for converged mobile devices was strong, posting double-digit increases year over year.

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