Worldwide mobile device sales on pace for flat growth in 2009, says Gartner

Stronger-than-expected sales in Western Europe and an acceleration in the gray market in the third quarter of 2009 will drive worldwide mobile device sales to end users to 1.214 billion units, a 0.67% decline from 2008, according to Gartner. In September, Gartner had forecast sales to decline 3.7% in 2009. Gartner now predicts sales in 2010 will show a 9% increase from 2009.

"Although the gray market or "white label" is not a new phenomenon and has been generated by China-based device manufacturers who do not have a license to sell and manufacture devices without a valid IMEI, today gray-market sales are no longer limited to China," said Carolina Milanesi, research director at Gartner. "All manufacturers will have to compete with gray-market players as they expand into emerging markets in Asia/Pacific, Eastern Europe, the Middle East and Latin America and bring a lower weighted ASP. The gray market will affect Nokia's market share the most."

In 2009, overall market economic conditions impacted disposable income and extended replacement cycles in mature markets from 12 to 18 months. Gartner expects replacement cycles globally to return to normal within two years, with the introduction of more aggressively priced smartphones and shorter contracts. Gartner also expects second-hand sales in emerging markets and SIM-only sales globally to stabilize in 2010 and to start decreasing from 2011 as consumers feel less macro-economic pressure.

Smartphone volumes will represent 14% of total mobile device sales in 2009, growing by 23.6% from 2008 and to 38% by 2013. However, this positive outlook could be negatively impacted by mobile operators' decision to associate all smartphones with high flat-rate data plans, which could increase the total cost of ownership beyond mass-market consumer acceptance. Despite this, Gartner expects global ASPs for enhanced phones and smartphones to decline by 3% in 2010.

The strong performance of markets such as Western Europe and Asia Pacific was balanced by weaker-than-expected sales in Latin America and the Middle East and Africa.

Gartner: Mobile terminal sales to end users, worldwide, 2007-2011 (k units)

Region
2008
2009
2010

Asia/Pacific
453,100.1
479,862.6
546,770.8

Eastern Europe
96,068.0
81,145.1
84,995.0

Japan
40,588.1
34,871.7
34,897.9

Latin America
142,323.1
119,737.5
126,772.7

Middle East and Africa
133,471.9
128,879.6
140,305.1

North America
182,245.8
182,571.6
190,130.8

Western Europe
174,455.3
186,950.5
198,498.9

Worldwide
1,222,252.30
1,214,018.60
1,322,371.20