Mike Harvey, Technology Correspondent
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Global sales of mobile phones may be falling, but demand for smartphones — which are more like mini computers — are heading in the opposite direction.
Global mobile phone sales fell by a record 8.6 per cent in the first quarter of this year to 269 million units, hit by the slowdown in consumer spending, and are likely to decline by 4.2 per cent for the full year, according to the Gartner research group. The expected fall comes after more than six years of uninterrupted growth and is the biggest quarterly decline since Gartner began monitoring sales in 2001.
Yet sales of more expensive smartphones — such as Apple's iPhone or Nokia's touchscreen 5800 — rose 12.7 per cent in the first quarter to 36.4 million units, against the same quarter a year ago.
Smartphones accounted for 13.5 per cent of mobile phone sales in the first quarter, compared with11 per cent in the same period last year, according to Gartner, which predicted growth of 27 per cent for 2009 as Apple, Palm, Research In Motion (RIM), Nokia and Samsung all launch new models.
Multimedia-enabled smartphones should account for at least half of all mobile phones in the next three to four years, Sehat Sutardja, chief executive of Marvell Technology Group, a Californian semiconductor manufacturer, said. “Smartphones today are only addressing the tip of the pyramid. I would say in the next three to four years, at least 50 per cent of the market will move to smartphones,” he said at a technology summit last week, adding that the figure could rise to as high as 90 per cent in six to seven years.
Growth will be driven by new launches and declining overall prices in the smartphone sector. This summer Apple will launch a new version of the iPhone, which has changed customers' expectations of mobiles and already has a 10 per cent share of the smartphone market. The latest iPhone, which could be launched as early as Apple's Worldwide Developers Conference in San Francisco on June 8, will have a new operating system and a more powerful camera.
Palm, maker of the Treo and other digital assistant devices, will launch a new smartphone on June 6. Palm is relying on the Pre to relaunch the company: its shares rallied from $3.30 in January to more than $12 in anticipation of the phone. With its new operating system hailed as a rival to the iPhone, Sprint Nextel will sell the Pre for $199.99 (£125) with a two-year contract, in line with iPhone pricing. Some analysts fear that the Pre could be upstaged by a cheaper version of the iPhone, which may be part of Apple's summer package. Other new launches include RIM's BlackBerry Storm 2 and the Samsung Jack, which has just gone on sale in the United States.
Nokia remains the world's top handset maker, but it has been losing market share in high-end and high-margin smartphones to rivals. The success of the Nokia 5800, its first touchscreen phone, has helped it to boost its smartphone market share to 41.2 per cent from 40.8 per cent from the previous quarter. RIM has 20 per cent of the market.
In the overall mobile phone market, Nokia retained its first place ranking in the first quarter of 2009, with sales of 97 million mobile phones. Its market share fell to 36.2 per cent from 39.1 per cent in the first quarter of 2008. Samsung was in second place, with a 19.1 per cent share, up from 14.4 per cent, thanks to a 21.4 per cent gain in sales. Motorola suffered a near-45 per cent fall in sales in the first quarter, ceding third place to LG, of South Korea.
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