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Mobile phone shipments drop in first quarter

Worldwide mobile phone sales slipped 11.6% in Q108 says IDC

Mobile phone shipments dropped in the first quarter of the year, down 11.6% from Q4 2007. According to IDC, unit shipments were down to 291.6 million from 330.8 million units in the last quarter of 2008, although the figures was up 14.3% from the same quarter last year.

Analysts said the downturn was expected given global economic concerns and a usual seasonal lull when compared to the busier end of year period.

Ramon T Llamas, senior research analyst with IDC's Mobile Device Technology and Trends team commented: "The mobile phone market will be under increased pressure from a number of factors that compete for users' attention and wallets. Disposable income is being eroded by rising food and fuel prices and worries about global financial markets and slow economic growth are creating a cautious outlook for the months ahead. Against this backdrop, many emerging markets continue to offer tremendous growth potential and IDC expects highly competitive pricing and innovative service plans will keep the overall market on track for the year."

Nokia maintained its leadership of the sector, with shipment volumes greater than its three nearest competitors combined. Strong performance in emerging markets, and high revenues from more fully featured handsets drove its results. Samsung also performed well in emerging markets, and extended its lead over struggling Motorola in third. LG managed to return to double-digit profitability and also took the number four slot back from Sony Ericsson.

"As predicted, most mobile phone vendors experienced a lull in the first quarter of 2008 with the exception of LG," said Ryan Reith, senior research analyst for IDC's Worldwide Mobile Phone Tracker. "Continued growth in the low cost segment will mean average selling prices (ASPs) will be generally lower than in the past, but this will be balanced somewhat by further expansion in the converged mobile device or smartphone segment, especially in mature markets."

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