It’s safe to say that the mobile phone industry was waiting with bated breath for market leader Nokia to deliver its fourth-quarter and full year results for 2008. It did so this morning, claiming that the number of mobile devices sold in 2008 is in the order of 6% higher than in 2007.
Not great news, but not catastrophic, either. However…
Nokia has again revised downward its forecasts for 2009 and now expects a decline of 10% or so in the coming year, topping the 5-8% falls predicted by many other parties. Ouch!
With this in mind, vendors will move to cut marketing costs, reduce employee numbers, mark down existing inventory, and limit the number of new models launching this year, while also striving to make sure that the products that are released come with the right mix of audience-pleasing standard gadgets as well as ‘new’ innovations such as touch screens and social networking functionality.
Nokia claims that 1.21 billion mobile devices were shipped worldwide in 2008, of which it accounted for around 39% (that’s 468 million, up by 7% y-o-y). Converged devices (or smartphones) numbered 161 million, or 13.3% of all mobile devices in 2008, in line with Juniper Research’s expectations. Sony Ericsson shipped 96.6 million devices, down by 6.6% y-o-y and a market share of around 8%. LGE did a little better, with 100.8 million units sold, up by 25% y-o-y.
Motorola expects a 59% y-o-y fall in its mobile device shipments (circa 100 million), underscoring its operating woes. Although Apple says iPhone sales slipped almost 37% in the most recent quarter, this was inevitable considering that previous quarters had been boosted by the new 3G iPhone. Y-o-y, Apple claims an 88% improvement in quarterly iPhone shipments.
With a little over one billion new devices likely to sell this year, handset vendors, network operators and content providers need to work much harder and more closely if they are to persuade users to continue or increase the rate of consumption of value-added services.
For Nokia, which expects the mobile Internet services business to generate revenues of €2 billion per annum by 2011, a great deal of hard work lies ahead in persuading partners such as network operators to change their ARPU-based mindsets to allow for more financially-rewarding revenue-sharing arrangements with content providers. Juniper Research believes that better deals for content providers means more content at lower costs to users, which will hopefully translate into increased usage (and therefore spending) by customers and thus to raised profits (for operators and content providers alike).
Hmmm… well, maybe not this year, then…
Tags: Apple, ARPU, business models, converged device, LG Electronics, mobile, mobile content providers, mobile data, mobile device, mobile internet, mobile network operators, mobile phone, mobile phone sales, mobile phone shipments, Motorola, Nokia, revenue sharing, smartphone, Sony Ericsson
[...] Samsung Electronics sold almost 200 million mobile handsets in 2008, a 24% improvement on the previous year. Thus, the company has become the only handset vendor, so far, to have reported y-o-y improvements in handset shipment volumes in each consecutive quarter of 2008. Indeed, this achievement is vastly superior to the overall 5-6% growth recorded by the industry as a whole. [...]
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