The Western European mobile phone market maintained double-digit growth in the opening quarter of 2006 as shipments increased by 11% year on year to reach 40.7 million units, compared to 36.8 million in the corresponding quarter of 2005.
“Although mounting saturation in subscriber growth across Europe is increasingly inhibiting handset shipment growth, matched the growth rate exhibited in the opening quarter of 2005 despite a lack of impetus commonly provided by new handset launches,” said Geoff Blaber, senior research analyst, European Mobile Devices at IDC.
“Mounting consumer migration towards WCDMA devices driven by competitive service pricing and ASP declines, combined with highly aggressive handset subsidies across operator portfolios, was a key market performance driver.”
However, downsizing of portfolios meant the top 3 vendors accounted for almost 70% of all traditional mobile phones shipped, compared to 62% in 2005.
“Operators’ scrutiny of handset portfolios is now beginning to significantly impact vendors without the capability and resources to meet stringent operator demands across multiple product lines with regard to software and hardware customisation, UI, and form factor design. Such vendors need to focus R&D towards operator requirements by integrating such components to produce closely positioned products that serve very specific segments,” said Andrew Brown, program manager, European Mobile Devices at IDC.
Increased carrier demand for highly customisable devices and higher ARPU (average revenue per user) driving solutions also meant that converged devices increased their proportion of the total market to 7% in 1Q06 from 5% in the opening quarter of 2005 as consumers continued to migrate predominantly towards S60 devices from high-end feature phones.