subscribe: Daily Newsletter

 

Mobile phone sales still on the up

0 comments

Worldwide sales of mobile phones to end users in the third quarter of 2007 reached 289-million units, a 15% increase from the same period last year. The top five vendors increased their market shares and accounted for 81,6% of the global market share. 

“Even though relatively few models were introduced this quarter, overall sales exceeded expectations. Mobile phone sales were mainly driven by strong performances in Asia/Pacific and Eastern Europe, the Middle East and Africa,” said Carolina Milanesi, research director for mobile devices research at Gartner. “The third quarter also saw Samsung gain the number two position, taking advantage of Motorola’s continued weak performance.”
Nokia’s mobile phone sales to end users totaled 110,2-million units reaching a market share of 38,1% in the third quarter of 2007. This quarter, Nokia not only exhibited the highest year-on-year market share increase, but also raised operating margins thanks to effective cost management and global distribution strategy. This was achieved despite the average price of its phones falling.
The lower average price was linked to the higher proportion of ultra-low cost devices sold in the quarter. Nokia was also the main provider of those devices as Motorola shifted focus away from them.
Samsung’s sales to end users reached 41,8-million units and saw the vendor gain the number two position as it better managed its channel inventory. Sales of its Ultra Edition II series continued to gain momentum in key markets such as Western Europe, where Samsung reached 21% market share, its strongest performance in the region.
“Samsung will have to continue to closely manage its inventory in the last quarter of the year so they do not to start 2008 on the wrong foot,” Milanesi says.
Motorola’s sales into the channel remained weak and, with limited surplus stock, sales to end users were not enough to maintain its number two position. Motorola’s market share dropped 7,6 percentage points from the third quarter of 2006, relegating the vendor to the third position.
“Motorola today is a pale version of the company it was a year ago,” Milanesi adds. Although the Razr2 was well received and accounted for 900 000 of the overall sales, Motorola needs a much stronger portfolio to return to its former market share.
Sony Ericsson's positive performance continued in the third quarter of 2007 as sales reached 25,4-million units. As Sony Ericsson built up sales volume and presence in some regions, such as Latin America, it also saw a slight increase in inventory among distributors.
LG sold 20,5-million units in the third quarter of 2007 and reached a market share of 7,1%. LG faced stronger competition in markets such as India, where the code division multiple access (CDMA) market has become challenging as operators closed deals with new entrants such as ZTE.
Sales of mobile phones in Eastern Europe, the Middle East and Africa reached 49,6-million units in the third quarter of 2007, a 3,5% increase from the same period last year. Growth in the region remained strong as mobile operators in Africa continued to add new subscribers to their networks.