Good Christmas sales ahead for cellphones

HELSINKI: Fast growth in the cellphone industry, the largest consumer electronics sector in the world, is set to continue in the holiday-sales-fuelled fourth quarter, research firm Gartner said on Tuesday.

All handset vendors combined sold 289 million mobile phones in the July-September quarter, with strong demand in Asia and Africa lifting sales 15 percent from a year ago, Gartner said, adding it does not see much changing in the ongoing quarter.

"I think it's going to be a good Christmas, showing growth of 10 to 15 percent from last year," Gartner analyst Carolina Milanesi said.

Top cellphone providers have said they envisage that the market will grow more than 10 percent year-on-year in the October-to-December period. Gartner said annual sales were set to reach its earlier forecast of 1.134 billion phones or slightly more.

Milanesi said Western Europe should see good holiday sales, helped by new models from major players like Nokia and Sony Ericsson, while robust growth in emerging markets in Africa and Asia was set to continue "India and China are not showing any signs of slowdown," she said.

The main gainer from the surging sales on emerging markets was the world's largest handset maker, Nokia, whose market share rose to 38.1 percent in the third quarter from 35.1 percent in the same quarter last year, Gartner said. The Finnish company has a strong lead in emerging markets, including China and India.

With about 8 million new customers signing up for mobile phones each month in India alone, the world's leading cellphone makers are falling over each other to woo first-time buyers with low-priced handsets.

South Korea's Samsung surpassed Motorola Inc with 14.5 percent of the market, compared with 13.1 percent for the U.S. company, Gartner said.

Sony Ericsson and LG Electronics also increased their market shares to 8.8 percent and 7.1 percent, respectively, it said. Nokia benefitted from demand for ultra-cheap phones in the quarter, but it reported superior profit margins.

Nokia's profit margin on cellphones rose to 22.2 percent in the quarter, while its best-performing rivals -- Samsung and Sony Ericsson -- were at 12.3 percent and 12.6 percent, respectively.