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Camera phones likely Christmas presents
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By Jørgen Sundgot, Monday 18 August 2003  
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Camera-phone market set to double by the end of the year says ARC Group analysts in Future Mobile Handsets 2003-2008 report.
According to a report released today by analyst firm ARC Group, by the end of 2003 more than 55 million consumers worldwide will own camera-phone handsets, more than doubling from the 25 million mobile units sold in 2002. For the UK and many other mature markets worldwide, the growth will come from existing mobile phone users as they are encouraged by handset manufacturers and network operators to replace their handsets with more feature-rich models, a turnaround from a few years ago when the emphasis was on the first-time buyer.
"This year we have seen a massive growth in camera-enabled phones, with 15 per cent of handsets worldwide featuring built-in cameras or designated camera accessories," commented David McQueen, ARC Group's Senior Consultant and author of the Future Mobile Handsets 2003-2008 report. "Tempted by innovative design features such as rotational cameras and swivel screens, along with the advent of multimedia messaging, colour displays and polyphonic ring tones, we'll see many consumers upgrading their mobile phones this Christmas."
The ARC Group study into the future of mobile handsets predicts that by 2005, 130 million handsets with camera capability will be shipped globally, and with the additional boost of 3G roll out, this figure is expected to increase to 210 million by 2008. "Globally, the Asia Pacific region will continue to lead the way, but Europe is expected to improve its market share through the continued take-up of mobile messaging services and with operators promoting attractive services such as Vodafone's Live! service," McQueen explained.
ARC Group predicts the entire mobile handset market to grow by 10.3 per cent with consumers buying 444 million mobiles by the end of 2003, up from 402 million in 2002. This trend is set to continue for the next five years, with handset sales forecast to reach 689 million by 2008, in line with subscriber growth. "Despite continued delays to 2.5G and 3G network roll out in the early part of 2002, there was distinct expansion by the end of the year, and the market in 2003 has since staged a comeback," commented McQueen.
Other findings of the report inlcude 2002 having seen a noticeable change in the market shares of the major handset vendors, although the top two, Nokia and Motorola, remain the same. Most notable rises are Samsung which has increased its worldwide share to around 12 per cent, and LG, which is doing well in the CDMA market. Siemens also saw its share grow in 2002, however market share for Sony Ericsson and Alcatel has slipped. For the first half of 2003, the top four remained unchanged, although LG was hampered by SARS and Sony Ericsson staged a comeback to push up its market share.
The GSM family currently holds around two-thirds of the handset sales market, and this is forecast to increase to 77 per cent by 2008 due in part to the migration of TDMA operators' subscribers to GSM networks. CDMA share is to rise from current levels of 16 per cent to 17.5 per cent by 2008, in line with subscriber growth forecasts for the technology. However these forecasts across technologies could be altered following the announcement this year by Samsung and Qualcomm who are partnering to develop the world's first multi-mode, multi-band handset enabling GSM and CDMA network roaming with one subscription.
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