Mobile phone growth slumps

 

Gallery

By Reuters

Posted on 14 Jul 2008 at 11:29

Research firm Gartner has cut its forecast for mobile phone growth in 2008 as a global economic slowdown starts to crimp demand.

Gartner now predicts the market will grow by 10-11% in 2008. At the end of May Gartner forecast 10-15% more phones would be sold this year.

"In the last month however, the economic environment started to negatively impact emerging markets as well as mature," says Carolina Milanesi, head of mobile device research at Gartner.

Shares in Nokia and Ericsson lost most of their earlier gains on the news."Signals for a weaker than expected second quarter have arrived from Sony Ericsson as well as some component manufacturers," Milanesi says.

The world's fifth largest phone maker, Sony Ericsson warned on 27 June it would make no profit in the April-June quarter due to weaker demand for its more expensive phones, and said the market was challenging.

"Despite expecting a stronger second half, we feel that the weakness of the first half has pulled the overall year growth down to 10-11%," she says.

Earlier on Monday Salcomp, the world's top maker of mobile chargers, warned its 2008 operating profit would fall from last year's level, citing expectations of weaker volumes during the second half of the year.