Gartner Upgrades 2005 Global Mobile Phone Sales Forecast

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Research company Gartner Inc. (IT) Wednesday raised its forecast for the number of mobile phones sold globally in 2005 to 779 million, a 16% increase from 2004. Gartner had anticipated 720 million sales globally at the start of the year. The research company also said it expects over 1 billion mobile phones to be sold globally in 2009, with 2.6 billion mobile phones in use by the end of that year.

“The world’s appetite for mobile phones has exceeded even the most optimistic expectations,” Ben Wood, research vice president for mobile terminals at Gartner, told Dow Jones Newswires.

Wood said the strength in mobile phone sales will be across the board, with strong growth in both emerging markets in Asia Pacific, South America, Eastern Europe and Africa bolstering growth in mature markets like North America and Western Europe.

He said that by 2009, India will outpace China as the fastest growing market for mobile phones with 139 million units sold compared to China’s 131 million. He said that by 2009, a third of all mobile phones sold globally will be in the Asia-Pacific region as opposed to around a quarter now.

In Africa, the emergence of the $20 handset will boost sales, he said.

Gartner’s Wood said he expects the Eastern European and South American markets growth to slow in 2006 as replacement cycles slow down.

Also of significance, Wood said Gartner forecasts over 100 million third-generation, or 3G, phones will be sold in 2006 and over 200 million smartphones - mobile phones with computing capabilities - will be sold in 2008. The number of smartphones sold is expected to double in 2006. He said about a third of the 3G handsets are expected to be sold in Japan.

Of the vendors, Wood said he expects growth to benefit the six largest global handset makers. He said companies making less than 10 million units a year are going to come under increasing pressure to maintain margins.

Gartner forecasts that the average wholesale price of a mobile phone will decline from $174 in 2004 to $161 in 2009.

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