Handset Makers Can Expect Poor Performance in 2012

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Handset makers are facing low sales growth this year due to weak global economy, which discourages the replacement of old equipment by consumers.

The results of the fourth quarter of 2011 should already show this slowdown. However, the long awaited iPhone 4S, from Apple, and new offerings from Samsung Electronics must have been exceptions in a warm holiday season.

"Apple is expected to remain in the lead, while among the manufacturers that use Android (operating system), only a strong brand like Samsung should stand out," said Carolina Milanesi, an analyst at Gartner research group.

Apple, which lost to Samsung the position of world's largest maker of smartphones in the third quarter, may have regained the position with the rush of consumers to buy the latest iPhone, after 16 months with renewals on line.

Sony Ericsson will start the season with spreading of results of the cellular segment, on Thursday, with analysts expecting a 6 percent decline from sales of 10.5 million phones in the fourth quarter of 2010.

Sony has agreed to acquire part of Ericsson's joint venture formed by both last October.

The Taiwanese HTC, Research in Motion, the maker of the BlackBerry, and Motorola Mobility were warned of weak sales in the holiday season, crucial sales period, in which many consumers replace their handsets.

Manufacturers must report sales of about 142 million smartphones in the period from October to December, 42 percent higher than calculated in the same period in 2010, according to Reuters poll. But analysts say that not all manufacturers have benefited.

"We expected that demand for smartphones would remain firm in the fourth quarter, but the price fall has become evident. Profitability remains a crucial indicator, and it is likely that Apple and Samsung have extended their lead," said Geoff Blaber, analyst at CCS Insight.

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1 comments of our visitors:

03 July 2012 wrote:
Sure, economy is in recession however there are still plenty of people who are saving money in order to purchase a new gadget, just because it is trendy. I agree, that handset makers might have poorer performance comparing to the last years, but it doesn’t mean they won’t be profitable.
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