A weakening global economy will blunt sales growth in the mobile phone market this year, research firm Gartner said today.
Gartner said it expects market growth to slow to 11 per cent from 16 per cent last year, while in US dollar terms growth would slow to 9 per cent from 11 per cent.
The world's top mobile manufacturer Nokia has forecast the market will fall this year in euro terms.
"We are starting to see impact of the economy," said Gartner analyst Carolina Milanesi, adding increased competition and the weaker economy would also hurt average selling prices.
"In addition, mobile phone manufacturers will be put under pressure to maintain healthy margins while they intend to further break through in the emerging markets to increase sales," she said.
Ms Milanesi said she expects cellphone sales in Western Europe in 2008 to be roughly on last year's level, underpinned by strong growth in the second half on the back of attractive new models reaching the market.
Mobile phone sales in this key region for phone makers like Nokia and Sony Ericsson fell 16 per cent year-on-year in the first quarter and 8 per cent in the second quarter.
Handset vendors sold 304.7 million mobile phones globally in April-June, with strong demand in emerging markets lifting sales 11.8 per cent from a year earlier, Gartner said.
Handset sales volumes in emerging markets surpassed developed markets in 2005 and last year 63 per cent of phones were sold in these developing markets, according to Strategy Analytics.
The main gainer from surging sales in emerging markets was Nokia, whose market share rose to 39.5 per cent in the second quarter from 36.7 per cent in the same quarter the previous year, the research firm said.
Samsung had 15.2 per cent of the total market in the quarter, compared with 10 per cent for Motorola.
Sony Ericsson's market share fell to 7.5 per cent, dented by the fall in the western European market. LG Electronics' market share rose to 8.8 per cent.
Gartner said Motorola and Samsung sold more phones in the quarter than they shipped, reducing inventories; while Nokia, Sony Ericsson and LG Electronics built up some inventory.
Reuters