Cell-Phone Industry Faces Hard Times

Posted by at 3:54 pm on February 9, 2009

After 25 years of stellar growth, the cell phone industry faces huge challenges this year from a poor economy and a lack of new features, reports In-Stat. The bleak cell phone industry outlook is unprecedented, with dramatic ramifications for device manufacturers, semiconductor manufacturers, and mobile operators alike.

“While the cell phone industry has generally been unaffected by economic ups and downs, the near future is different,” says Allen Nogee, In-Stat analyst. “The current economic slowdown is more widespread and deeper than ever experienced during the cellphone’s lifetime, and has spread through Europe, Asia, and North America. In addition, this is the first year without any new major features being added, and last year’s new feature, mobile TV, has only become popular in limited regions.”

Recent research by In-Stat found the following:

  • Over 1.2 billion cell phones were estimated to have shipped in 2008, but the growth rate is plummeting.
  • For the next five years, cell phone semiconductor revenue will only grow at a 3.3% Compound Annual Growth Rate (CAGR).
  • Shipments of dual-mode cellular/Wi-Fi phones shipped will quadruple from 2008 to 2012.
  • The market for digital baseband semiconductors in WCDMA handsets will reach more than $6 billion annually in 2012.
  • In 2008, cell phone semiconductor revenue was expected to reach more than $44.5 billion, up over 6.2% over 2007.

The research, “A Tarnished Silver Anniversary for Handsets-”Worldwide Handset and Semiconductor Forecast” (#IN0804042WH), covers the worldwide market for cellular handsets and semiconductors. It provides a comprehensive view and five year forecasts of:

  • Cell phone shipments and revenue
  • Cell phone semiconductor revenue
  • Segmentation by region and technology (TD-SCDMA, LTE, WCDMA, CDMA, GSM)
  • Segmentation by device type (ICs & Discretes, Power amplifier, Radio, Memory, Apps processor, analog and digital baseband)
  • Feature & attach rates forecasts of WLAN, Over-the-Air Tuners, Bluetooth, Cameras, CCD and CMOS Image sensors, and GPS
  • Deep analysis of semiconductor and handset trends

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