Finnish mobile phone company, Nokia, has defended its November forecast that the mobile phone market will grow by up to 10% in 2005, to 693 million handsets.
Nokia’s predictions last month claimed the market would increase from the 630-650 million units it expects in 2004 and this growth could be stronger if the sales of 3G handsets take off in the latter half of the year. Recent forecasts from an industry intelligence group, Wireless World Forum (W2F) predicted that subscribers of third-generation (3G) mobile telephones will nearly double over the next year, growing from 45 million in 2004 to 85 million in 2005 (see
Global 3G Subscribers To Double to 85 Million In 2005).
Jorma Ollila, Nokia’s chief executive said in a statement issued in connection with the company’s Capital Markets Days in New York last week, that he was “confident” that the figure would be reached through “a combination of emerging markets and a good and healthy replacement market.”
According to a report in the Financial Times, Nokia expects to achieve a share of more than 30% of the global handset market by the end of this year, with long-term forecasts nearing 40%.
Some media analysts, however, have questioned Nokia’s positive forecast saying the influx of new subscribers in emerging markets may slow in 2005. Analysts at Nomura, the investment bank, are predicting handset growth of just 2-3% and Morgan Stanley is forecasting an increase of 4%.
Mr Ollila estimated that year on year mobile device volume growth for 2005 would be fastest in Latin America, Europe, Africa, Middle East and North America, while expansion in Asia-Pacific and China would be significantly slower.
He dismissed claims that Nokia had been slow to get 3G handsets on the market and said: “We can’t afford to be very late, but being the first is not an issue for us.”
He added: “We expect penetration to grow and the replacement rate to remain stable as more advanced camera phones, brighter colour screens, MP3 players and 3G encourage upgrades.”
By 2008, more than 600 million camera handsets and 200 million smart phones will be sold annually, Nokia estimated. The Finnish giant now also expects the global mobile phone subscriber base to reach two billion users in 2006.
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