Alcatel eyes more local market share with low-end units

French handset maker Alcatel SA is jostling for a bigger role in Taiwan's 6-million-strong mobile phone market, betting on rising demand to replace gray-scale models, company officials said yesterday.

"We think growing demand to replace monochromatic screens will be a major engine for the handset industry here," said Vivian Huang (黃斐雯), a marketing officer at Alcatel's Taiwan division.

Huang made the remarks on the sidelines of a press conference to launch Alcatel's latest product -- the OT756. The unit is a bar-type model featuring a 300,000-pixel camera and multimedia functions, including MP3 music.

Alcatel hopes to take 4 percent to 5 percent of Taiwan's market this year, Huang said. She declined to reveal a comparative figure for last year.

Alcatel also plans to unveil three low-end cellphones later this year to cater to price-conscious consumers' need to replace gray-scale models, Huang said.

Alcatel will have five models available locally by the end of the year, including the newly launched OT756 and Alcatel's first clamshell -- the OT835.

Entry-level phones will account for a big chunk of of Alcatel's product portfolio for 2004.

"It's a real challenge for Alcatel to get a 5 percent share of the local market by launching only five models," said Marty Kung (龔俊光), an analyst at the Taipei-based Market Intelligence Center (MIC, 資訊市場情報中心).

In the quarter to September, Siemens AG, the world's fifth-largest mobile-phone producer, will have four new models available here in Taiwan, he said.

Motorola Inc, the largest mobile-phone player in Taiwan, said it planed to roll out 20 to 30 new models this year, offering a complete product line.

"Sales of entry-level cellphones are huge, making up 60 percent of Taiwan's total handset sales," Kung said. "But the competition in this area is stiffer."

Local brands, such as BenQ Corp (明基電通) and Dbtel Inc (大霸電子), count on cooperation with local mobile operators such as Chunghwa Telecom Co (中華電信) for growth, he said, adding that the strategy seems to be working

BenQ grabbed nearly 10 percent of local market share during the first half of 2004.

"Alcatel is primarily focusing on mainstream phones rather than niche models," Huang said.

She said that Alcatel does not plan to roll out high-end models this year, including smartphones, handsets equipped with one-mega-pixel camera, or phones with special functions -- such as those that turn mobile phones into walkie-talkies -- citing limited demand.

Taiwan purchased 6.15 million mobile phones last year, and the number is projected to rise 3 percent to around 6.37 million this year, according to MIC's forecast early last month.