Worldwide Handset Market Shows Signs of Life, Rebounding From Its Worst Year Ever, IDC Says
FRAMINGHAM, MA – DECEMBER 9, 2002 – Despite being tied to a telecom industry that FCC Chairman Michael Powell recently described as "in utter crisis," the worldwide handset market will rebound from its worst year ever and increase shipments 1.8% in 2002. According to new research from IDC, there is good reason for optimism as shipments are projected to increase from 391 million in 2002 to 606 million in 2006, a compound annual growth rate of 9.5%.
"A wireless revolution is waiting in the wings," said Kevin Burden, program manager for Smart Handheld Devices at IDC. "When mass wireless adoption occurs, it will result in a paradigm shift comparable to that created by the World Wide Web. However, until that happens, handset vendors must continue to research and develop enhanced features and functionality that will drive higher average revenue per user (ARPU)."
Modest growth in the handset market will come from first-time buyers and new subscribers in emerging markets, but it will be replacement sales in mature
markets that will prove critical to overall market growth. A true market explosion, however, is contingent on the timely deployment of next- generation networks and the availability of compelling content and applications.
The worldwide handset market experienced it worst-ever performance in 2001, declining 4% from the previous year
The top-five handset vendors held 71.9% of total market share in 2001
A significant escalation towards outsourcing handset production will continue to mount
IDC forecasts the demise of analog handsets by 2003
Shipments of 2.5G handsets will surpass 2G handsets by 2005
Worldwide converged device (PDA/handset) shipments will reach nearly 63 million in 2006
This study, Attack of the Phones: Worldwide Handset Market Forecast and Analysis, 2002-2006 (IDC #28222) is the result of IDC's ongoing research on mobile handsets. Market data is acquired and refined based on a number of IDC proprietary and public sources, both primary and secondary. The information is then filtered through IDC's forecasting and analysis process. This is an ongoing, iterative process in which initial forecasts are made, analyzed, and revised through the collaboration of IDC analysts worldwide and across research services.
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IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in- depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.
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