Mobile Phone Market Starts to Recover in Western Europe

Smartphones continue to gain more ground on the market

The mobile phone market seems to begin its recovery after the financial downturn that affected it during the past few quarters, at least this is what IDC says that happens in the Western European countries. The IDC European Mobile Phone Tracker shows that, compared with the second quarter of the last year, handset makers shipped six percent less devices (42 million units) in the area in Q2 2009, which shows an improvement over the 14-percent decrease registered a quarter earlier.

Even so, IDC says that the mobile phone market in the area will continue to shrink for the full year 2009. At the same time, the firm also says that, compared with the same time frame a year before, traditional mobile phone sales went down by 12 percent in the quarter, reaching 33.2 million units, while smartphones (called converged mobile devices) showed a growth of 25 percent in the three-month period, reaching 8.8 million units.

“The first six months of the year were very challenging to both vendors and operators in Western Europe. The market was hit hard by the financial crisis, and demand for mobile phones slumped as never experienced before,” Francisco Jeronimo, European mobile devices research manager, IDC, said. “Since 2Q08 the market has been suffering from negative growth, with the bottom line being hit in 1Q09. Despite the slight improvement in the second quarter of 2009, we will continue to see negative growth throughout the coming quarters, with full market recovery being seen only in 2011.”

According to the firm, the Western European market is expected to shrink by ten percent for the entire year, though the demand for smartphones will continue to show an increase. These handsets should account for 21 percent of the market, IDC says, while also adding that traditional phones will decline even more, though the decrease in sales will be slowed down by the inclusion of more features into lower cost devices.

“Among the biggest handset vendors, it is important to point out that Korean manufacturers continue to perform better than Scandinavian phone makers. For the first time, Samsung and LG together shipped more devices to Western Europe than Nokia. Nokia continues to be the market leader, with 36.3 percent market share, but the gap to Samsung, the second biggest vendor with 28.9 percent market share, continues to diminish. On the other hand, LG continues to challenge Sony Ericsson's market position, and the success of its touch screen handsets allowed LG to get 11.5 percent market share, the highest ever in Western Europe,” IDC also notes.

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