Mon, Jan 05, 2009 - Page 12 News List

Mobile phone market to shine this quarter

PRICE PRESSURE: Analysts say that the NT$3,600 consumer vouchers to be handed out before the Lunar New Year would encourage shoppers to replace older phones

By Elizabeth Tchii  /  STAFF REPORTER

The nation’s mobile phone sales are expected to reach 1.79 million units in the first quarter of this year, with a total market value of NT$10.24 billion (US$311.6 million), compared to last quarter’s anticipated sales of 1.71 million units with a market value of NT$9.72 billion, a research agency said in a report dated Wednesday.

The Market Intelligence Center (MIC) said its forecast model uses the assumption of an average selling price (ASP) of NT$5,720.

The center said it believed the issuance of NT$3,600 consumer vouchers combined with increased shopping momentum during the Lunar New Year holiday would generate demand for phone replacement, leading to an increase in overall mobile market growth.

The nation’s mobile phone sales reached 1.80 million units in the third quarter of last year, up 9.1 percent quarter-on-quarter, but down 2.1 percent year-on-year.

“In the third quarter, the Taiwanese mobile phone market experienced a slowdown in new subscriber growth. Sales were mainly generated by phone replacement demand,” MIC industry analyst Joyce Chen said.

“Additionally, the financial turmoil in the European and US markets caused the stock market in Taiwan to drop, reducing consumers’ discretionary incomes. The back-to-school effect did push market sales to a certain extent in the third quarter and stimulated the sequential growth of sales,” Chen said.

The East Asian information technology intelligence provider and consulting house believes the only way to boost consumer demand amid the slowing global economy is for “mobile phone vendors to lower mobile phone prices,” Chen said.

Thus, in the third quarter, local operators implemented a series of price cuts across all product segments.

“As a result, the ASP on the Taiwanese market fell to NT$5,736 and total market value reached NT$10.33 billion in the third quarter,” Chen said.

Aside from price cuts, Taiwanese telecom operators aggressively engaged in various promotions and preferential calling plans in the third quarter. Popular models such as Apple Inc’s iPhone and Research In Motion’s Blackberry Bold were only sold bundled with customized calling plans. Hence, the share of mobile phones sold through telecom operators increased last year, over 2007, MIC said.

MIC also said that the combined share of personal digital assistant phones and smartphones reached 5 percent in the third quarter. In this segment, Nokia and HTC sales led other brands by a wide margin.

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