Mobile phones are just about the only type of hardware still growing at a double-digit pace, and the future for the market continues to look bright as manufacturers bring data applications into voice handsets, according to research released Thursday by IDC.
Worldwide shipments of mobile phones grew 19.2 percent in the second quarter of 2003, as compared to the second quarter of 2002, IDC said in a release. A total of 118 million units were shipped, led by Nokia Corp.'s 40.9 million units.
The market for phones will continue to grow as new users discover cell phones, and experienced users trade in their voice-only handsets for cell phones that provide e-mail, Web browsing, and other data applications, said Alex Slawsby, an analyst with IDC in Framingham, Massachusetts.
IDC cited the rise in shipments of phones with color screens and digital cameras as one of the reasons for the continued strength of the market. About one-third of market leader Nokia's cell phones shipped in the quarter had color screens and multimedia capabilities, and the company shipped an increasing number of camera phones as well, IDC said.
Motorola Inc. came in second place, with 15.8 million units shipped in the second quarter, good for 13.4 percent of the market. This represents a decline in market share from last year's 17.4 percent market share, which can be attributed to strong competition in Europe and Asia from Nokia and third-place finisher Samsung Electronics Co. Ltd., Slawsby said.
Samsung increased its market share in the second quarter to 10.1 percent, shipping 12 million units, up from 9.5 million in the second quarter of 2002. The company has pursued a very aggressive product strategy with numerous cell phone designs and the utilization of its own components in its phones, Slawsby said.
The market for smartphones, or devices that combine voice and data capabilities, also grew substantially in the second quarter. Total shipments remain low as compared to the overall cell phone market, with 1.97 million units shipped in the second quarter, up from 456,601 units in the second quarter of last year.
Eventually, all cell phones will be smartphones, but it will take a few years to reach that point, Slawsby said. Early smartphone were really personal digital assistants (PDAs) with some voice capabilities built in as an application.
Users are much more interested in sleek devices in which voice is the primary function, and data capabilities are tacked on, he said. These types of devices are starting to make their way on to the market, and will enjoy increasing popularity in coming years, he said.