May 9, 2005 10:13 AM PDT

Cell phones to ring in slight growth

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IDC: Phone shipments surged in '04

January 28, 2005
Mobile-handset vendors, which handled spectacularly large shipments during the past two years, might have to be content with merely single-digit growth this year, according to an IDC report.

While global shipments of cell phones in 2004 grew 34 percent to 692 million, 2005 will see an increase of just 20 million units, the market researcher predicted. According to IDC, the boom in 2004 was driven by strong sales of cell phones, with features like cameras and color displays.

Demand is now down, the firm said, because so many people still have relatively new phones. Much of the new demand will come from economically emerging areas and first-time users.

"Strong demand from emerging markets, the attraction of color displays and camera-enabled mobile phones and delays in 3G network availability made 2004 a banner year for 2.5G mobile phone shipments," David Linsalata, an IDC analyst for mobile devices, said in a statement. The market will continue to expand through 2009, he said, albeit slowly.

IDC expects that by the end of 2005, the world's cell phone subscribers will total 1.7 billion.


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