LONDON, ENGLANDAccording to ABI Research, operators and distributors continued to top up their inventories in the first quarter of this year after a strong fourth quarter of 2007. "Year on year, 1Q 2008 was up 13.7 percent. But 2Q 2008 is likely to be softer than in previous years," said ABI Research vice president Jake Saunders. Shipment volumes in the developed markets have softened slightly due to the credit crisis. Yet emerging markets like Asia-Pacific, South America, and the Middle East/Africa are delivering growth rate percentages in the mid-20s. Mobile devices have proved to be a "lifestyle necessity," rather than a mere luxury accessory.
Despite the global concern about price inflation in food, rent, clothing, oil, and utility bills, device manufacturers are not benefiting. The average selling price (ASP) has shown comprehensive price erosion for all manufacturers. In the market-share stakes, Nokia increased its share to 39.9 percent while Samsung and LG were net winners with 16 percent and 8.4 percent, respectively. Motorola continued to lose market share (falling 2.6 percent) to 9.5 percent, while it was more of a surprise that Sony Ericsson lost market share (down to 7.7 percent). Sony's Walkman and CyberShot lineups may be in need of a substantial refresh.
WCDMA continues to build momentum with shipment volumes that are up 44 percent year over year. But no one should count out GSM, as GSM-enabled handsets grew 17 percent in the quarter. In addition, the market is still dominated by the "Big Five" manufacturers. However, an innovative tier of manufacturers (RIM, HTC, and Apple) has been stirring up interest in smartphones. They will soon be joined by a new class of mobile device: mobile Internet devices (MIDs). MIDs made their debut last year, but vendors like Lenovo, Aigo, and Asus are expected to drive growth rapidly.
"Mobile-device shipment volumes show no sign of abating in growth, despite the uncertain economy," said research director Kevin Burden. "ABI Research expects 2008 to top out at 1.28 billion devices shippeda 12-percent increase year over year. But these volumes could be subject to the overall global economic climate."