Mobile phone sales dip, smartphone's up 45 pc

MUMBAI, INDIA: Worldwide sales of mobile phones to end users reached 419.1 million units in the first quarter of 2012, a two per cent decline from the first quarter of 2011, according to Gartner Inc.

This is the first time since the second quarter of 2009 that the market exhibited a decline.

“Global sales of mobile devices declined more than expected due to a slowdown in demand from the Asia/Pacific region,” said Anshul Gupta, principal research analyst, Gartner. “The first quarter, traditionally the strongest quarter for Asia — which is driven by Chinese New Year, saw a lack of new product launches from leading manufacturers, and users delayed upgrades in the hope of better smartphone deals arriving later in the year.”

All vendors were impacted at different levels; however, white-box vendors seem to have suffered the most. While tier one players such as Nokia were negatively impacted on sell-in numbers (sold into retail), white-box vendors were unable to adjust production and were left with a build-up in inventory by the end of the quarter.

Gartner expects some of this volume to be sold during the next couple of quarters, because the channel is likely to lower the prices to dispose of the stock.

“The lower results in the first quarter of 2012 have led us to be cautious about sales for the remainder of the year,” said Annette Zimmermann, principal research analyst, Gartner. “The continued roll-out of third generation (3G)-based smartphones by local and regional manufacturers such as Huawei, ZTE, Lenovo, Yulong and TCL Communication should help spur demand in China."

"Moreover, the arrival of new products in mature markets based on new versions of the Android and Windows Phone operating systems (OSs), and the launch of the Apple iPhone 5 will help drive a stronger second half in Western Europe and North America. However, as we are starting to update our market forecast we feel a downward adjustment to our 2012 figures, in the range of 20 million units, is unavoidable.”

However, sales of smartphones continued to drive mobile device market growth, reaching 144.4 million units in the first quarter of 2012, up 44.7 per cent year-over-year.