Smart Phone Just Keeps On Growing
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The worldwide converged mobile device (aka smartphone) market set a new record for quarterly shipments in Q1 2006, according to research from IDC.

According to the IDC Worldwide Quarterly Mobile Phone Tracker, worldwide shipments of converged mobile devices totalled 18.9 million units in the first quarter, which was an increase of 7.5 per cent from Q4 2005 and an increase 67.8 per cent from Q1 2005. There’s a lot going on in the market, and the growth is showing no signs of slowing down, said Ramon Llamas, research analyst with IDC’s mobile markets team.

There are a lot of vendors getting into the converged mobile device space, Llamas said. Still at the top of the heap is Nokia, which captured 43.2 per cent of the worldwide market. While the company saw a bit of a decline from Q4 2005 to Q1 2006 (12.2 per cent, to be exact), the company saw 49.9 per cent year-over-year growth from Q1 2005 to Q1 2006. Nokia is by far the worldwide leader in the space, Llamas said. During Q1 2006, it added new devices to its product line-up, including several new N-Series devices and the E-Series, the latter of which is targeted at enterprise users.

Relative newcomers to the space Panasonic and NEC took the second and third spots in the top five, respectively. Panasonics shipments grew 28.3 per cent from Q4 2005 to Q1 2006, and 65.1 per cent from Q1 2005 to Q1 2006. Overall, Panasonic captured an even 10 per cent of the worldwide market.

Not far behind Panasonic was NEC, with 9.5 per cent of the market. NEC saw a 32.6 per cent increase in shipments from Q4 2005 to Q1 2006 and 57 per cent growth from Q1 2005 to Q1 2006. However, all of the company’s converged mobile devices were shipped within its home region of Japan.

Research In Motion experienced its fifth consecutive quarter of growth in Q1 2006. Its shipments grew by 12.4 per cent from Q4 2005 and Q1 2006, and the company saw 85.7 per cent year-over-year growth from Q1 2005 to Q1 2006. Overall, the enterprise-focused company had 7.7 per cent of the worldwide market share.

The only newcomer to the top five rounded out the list. Sharp joined the converged mobile device market late in 2005, so as a result, Sharp’s shipments grew 174.4 per cent from Q4 2005 to Q1 2006. That allowed the company to capture 5.7 per cent of the worldwide market share. As with NEC, Sharp only shipped devices in Japan.

While the converged mobile device market was at one time dominated by enterprise users, that is changing as vendors have begun to target the consumer market. Some, like RIM, still mainly appeal to the enterprise, but many of the newcomers are targeting consumers fairly heavily, Llamas said.

“These devices have made their way into the individual consumer side,” he said.

Vendors have been adding consumer-level functions such as multimedia capabilities, cameras and computer functions into the devices. “So what you have is a lot of other vendors are making devices with a consumer focus,” Llamas said.

He added, “Because folks are very mobile, in the sense that they’re in the cities, they’re in their cars, you have all the functionality you have on your computer now on your handset.” Converged mobile devices are fairly prevalent in the enterprise, but the market is still in the early adopter phase in the consumer realm, Llamas said. However, he said there is tremendous potential in the consumer market for converged mobile device vendors. There is still some hesitance on the part of many consumers, though.

“Most folks use their phone for one thing and one thing only, and that’s voice capabilities. What’s the value prop for them when they basically just want to use their devices to make phone calls? It’s a delicate balance that people are trying to figure out,” Llamas said. Vendors are currently trying to figure out how to entice such consumers into buying smartphones.

“Is there a tremendous potential in the consumer market? Yes, there is. The trick is can you bring that consumer user on to that,” Llamas said.