Economic woes slow mobile phone market

The worldwide mobile phone market is expected to grow this year at its slowest pace since 2009, hurt by sluggish economic conditions, a survey showed Wednesday. The research firm IDC said global shipments will rise an estimated four percent in 2012, with many users of older phones holding on to their devices before switching to a smartphone. The consultancy said a total of nearly 1.8 billion mobile phones will be shipped this year, compared to 1.7 billion in 2011. By the end of 2016, IDC forecasts sales of 2.3 billion mobile phones. IDC projected a 10 percent drop in sales of "feature phones" this year. "Many owners of feature phones, sometimes known as 'talk and text' devices, are holding on to their phones in light of uncertain job and economic prospects," IDC said. "Despite the decline in shipments, feature phones will still comprise 61.6 percent of the total mobile phone market this year." The number of smartphones sold will grow 38.8 percent to 686 million units this year, IDC said. "The smartphone parade won't be as lively this year as it has been in past," said Kevin Restivo, senior research analyst with IDC. "The mobile phone user transition from feature phones to smartphones will continue in a gradual but unabated fashion. Smartphone growth, however, will increasingly be driven by a triumvirate of smartphone operating systems, namely Android, iOS and Windows Phone 7." According to IDC, the Google Android operating system will boost its share of the smartphone market to 61 percent, but then taper off amid competition from others, including those using Microsoft Windows. "Android will maintain leadership throughout our forecast, while others will gain more mobile operator partnerships (Apple) or currently find themselves in the midst of a major transition (BlackBerry and Windows Phone/Windows Mobile)," IDC analyst Ramon Llamas said. "What remains to be seen is how these different operating systems -- as well as others -- will define and shape the user experience beyond what we see today in order to attract new customers and encourage replacements." The IDC report sees the strongest growth in the coming years from Windows smartphones, from 5.2 percent of the market this year to 19.2 percent in 2016. During the same period, the Apple iPhone will see its market share slip from 20.5 percent to 19 percent, with the number of iPhones growing at a slower pace than the overall market. IDC sees the BlackBerry holding virtually unchanged from six percent of the smartphone market in 2012 to 5.9 percent in 2016. "There will continue to be a market for BlackBerry OS-powered devices, despite Research In Motion's current woes," IDC said. "This is true in emerging markets, for example, where users are looking for affordable messaging devices," IDC said. "However, the gulf between the BlackBerry OS and its primary competition will widen over the forecast as the mobile phone market becomes increasingly software/app-oriented and the 'bring your own device' enterprise trend proliferates.