Gadget makers to find refuge in smartphone sales

Despite the global slowdown in consumer spending, handset vendors are expected to reap the benefits of growth in the smartphone segment, with sales of high end handsets on an upward curve over the next five years.

Figures released by analyst house and telecoms.com parent Informa Telecoms & Media this week predict that while total new handset sales will fall 10.1 per cent year on year through 2009, sales of smartphones are expected to grow 35.3 per cent.

By 2013, smartphone penetration is forecast to treble to just over 38 per cent, accounting four almost four in ten of all handsets sold worldwide. In 2009, smartphones are expected to account for around 13.5 percent of all new handsets sold worldwide.

Just over 49 per cent of all smartphones sold in 2008 were based on Symbian, a significant drop from a near 65 per cent share it enjoyed one year earlier. While Informa notes that this is largely due to the relatively poor performance of Nokia’s smartphone range, it is also an indication of the popularity enjoyed by competing platforms including Linux, BlackBerry, Microsoft Windows Mobile, OS X on the iPhone and new entrant Android.

But despite the pressure Symbian is under, Gavin Byrne, research analyst at Informa, believes that the Symbian Foundation’s move to adopt open source will help it maintain its leadership over Android, Linux and Microsoft.

Openness is a key criterion, while all in the mobile telecoms space now see the revenue potential of applications and services. Now more than ever, handset vendors must develop strategies to maximise these new revenue streams while reducing costs, said Byrne.

As more and more value moves from device hardware to software, and also to content, developers are becoming increasingly central to the mobile handset value chain. Platform and applications development are in many cases already reaping the benefits of open source components and approaches, with LiMo Foundation, Android and the Symbian Foundation being the most significant device platforms in market. “The decision to move the Symbian platform to open source is crucial in maintaining its leadership over Android, Linux and Microsoft”, said Byrne.

The growing importance of content development is reflected in the efforts that Apple, Google, Nokia, Microsoft, Qualcomm and Adobe have gone to facilitate development and a route to market, as represented by their application stores.