Handset market stays afloat with 258 million shipped in 1Q09, says ABI Research
Despite tough corporate and unemployment news making the headlines, the mobile handset-buying public did not head to the hills during the first quarter of 2009. Handset vendors had shipped 258 million handsets by the end of the quarter. Although that represents an 11% year-over-year decline, the result significantly exceeded the previous forecast of 253.5 million.
"Green shoots are sprouting," is how ABI Research vice president Jake Saunders describes the latest figures.
Distributors reduced their inventories in fourth-quarter 2008 and first-quarter 2009 as they prepared for an economic meltdown but the market did not take another "leg down" in the first quarter. ABI Research has revised its handset forecast for 2009 from a decline of 8.4% to 8%. Saunders notes, "This will not be a V-shaped recovery. Second-quarter 2008 was a fairly strong quarter for handset sales so handset shipments for second-quarter 2009 are going to report a 10% decline on year, but quarter-on-quarter, they should show improvement."
"As always there are winners and losers," comments practice director Kevin Burden. "Samsung and LG demonstrated healthy gains to take their market shares to 17.8% and 8.8% respectively. Another star performer was RIM, which raised its share to 3.0% due largely to the success of its Blackberry Bold. It is a little curious that Apple's market share is just 1.5% given the success of its AppStore. As popular as the iPhone3G has been, increased competition in the touchscreen segment and a lack of product differentiation may be dampening demand. ABI Research expects that by the second half of 2009 the iPhone3G will have one or more siblings. That will allow Apple to accelerate growth.
Nokia was beaten out by Sony Ericsson for the dubious distinction of showing the largest contractions (their shares now stand at 36.2% and 5.6%). Nokia will breathe a sigh of relief once its latest smartphone, the N97, enters the market. Nokia has had a fair amount of success with the E71 but needs to beef up its touchscreen product lines. While Sony Ericsson has the Experia smartphone line-up, the firm's exposure to the feature phone segment was squeezed more than other handset sectors. While feature phones serve many needs in the market, operators have been especially keen to snap up smartphone stock and were cooler on the ultra-low cost and feature phone orders.
Despite the positive signs, says ABI Research, the industry should be cautious. The IMF has issued another sharp downgrade to its global outlook. Unemployment figures are also likely to continue creeping up. Buyers in the developed world are still concerned about debt and job security. Developing economies are expected to take a hit on the credit side which could have knock-on consequences on credit lines for purchases and stock levels.
"Green shoots are sprouting," is how ABI Research vice president Jake Saunders describes the latest figures.
Distributors reduced their inventories in fourth-quarter 2008 and first-quarter 2009 as they prepared for an economic meltdown but the market did not take another "leg down" in the first quarter. ABI Research has revised its handset forecast for 2009 from a decline of 8.4% to 8%. Saunders notes, "This will not be a V-shaped recovery. Second-quarter 2008 was a fairly strong quarter for handset sales so handset shipments for second-quarter 2009 are going to report a 10% decline on year, but quarter-on-quarter, they should show improvement."
"As always there are winners and losers," comments practice director Kevin Burden. "Samsung and LG demonstrated healthy gains to take their market shares to 17.8% and 8.8% respectively. Another star performer was RIM, which raised its share to 3.0% due largely to the success of its Blackberry Bold. It is a little curious that Apple's market share is just 1.5% given the success of its AppStore. As popular as the iPhone3G has been, increased competition in the touchscreen segment and a lack of product differentiation may be dampening demand. ABI Research expects that by the second half of 2009 the iPhone3G will have one or more siblings. That will allow Apple to accelerate growth.
Nokia was beaten out by Sony Ericsson for the dubious distinction of showing the largest contractions (their shares now stand at 36.2% and 5.6%). Nokia will breathe a sigh of relief once its latest smartphone, the N97, enters the market. Nokia has had a fair amount of success with the E71 but needs to beef up its touchscreen product lines. While Sony Ericsson has the Experia smartphone line-up, the firm's exposure to the feature phone segment was squeezed more than other handset sectors. While feature phones serve many needs in the market, operators have been especially keen to snap up smartphone stock and were cooler on the ultra-low cost and feature phone orders.
Despite the positive signs, says ABI Research, the industry should be cautious. The IMF has issued another sharp downgrade to its global outlook. Unemployment figures are also likely to continue creeping up. Buyers in the developed world are still concerned about debt and job security. Developing economies are expected to take a hit on the credit side which could have knock-on consequences on credit lines for purchases and stock levels.
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