Global Mobile Phone Sales Growth Slows

A new report from Strategy Analytics puts the annual global growth rate in mobile phone sales below 20 percent - and Motorola took the hit.

A new report from market research firm Strategy Analytics finds that the global growth rate for mobile phone sales during the first three months of 2007 dropped below 20 percent for the first time in two years. According to the report, around the world, mobile phone makers managed to sell 252 million handsets during the three month period, an increase of just 12 percent over the same quarter a year ago.

Cell phone maker Motorola seems to have taken the brunt of the sales drop, seeing its overall shipments decline by 1.5 percent during the quarter. During the first three months of 2007, the company shipped 45.4 million handsets, but during the first three months of 2006 it managed to ship 46.1 million. Motorola seems to have fallen victim to a inventory buildup in the fourth quarter of 2006, which led to lower shipments during the first quarter of 2007. Motorola is working to cut costs and reduce the number of mobile platforms it offers, which simultaneously raising pricing and bringing out new phones. However, the report speculates Motorola’s changes will take “at least four to eight quarters to execute,” leaving the company in recovery mode for a year or more.

Amongst other mobile handset makers, Sony-Ericsson managed to increase its shipments by 63 percent year-on-year, shipping 21.8 million handsets during the first quarter. Number one cell phone maker Nokia moved a very respectable 91 million units during the first three months of the year (an increase of 21 percent), while Samsung increased shipments by 20 percent to 34.8 million units while maintaining a surprising 13 percent operating margin.