Designers and makers of cellular telephones are pursuing emerging and low-end markets with creative plastics-based models as volume growth slows in more mature regions.
Global shipment of mobile telephone handsets is projected in 2007 to grow 8.9 percent to 1.06 billion units from last year's 971 million, according to Yankee Group Research Inc.
``Significant growth in shipments will come from emerging markets like India and Russia,'' said Philip Marshall, a vice president in the wireless and mobile technologies group of Boston-based Yankee.
``The greatest volume [increases] will come from the low end of the market,'' Marshall said.
Shipments are projected to grow 4.7 percent in North America to nearly 168 million handsets, and 1.8 percent in Western Europe to 159 million units.
Gartner Inc. of Stamford, Conn., forecasts global growth of 11.3 percent with a 2007 sales projection of 1.1 billion mobile terminals, vs. 988 million units in 2006. The Gartner research business segment said the key factor driving the increase is higher-than-expected growth in the Asia-Pacific market.
International Data Corp. said global 2007 handset shipments would top 1.1 billion with the United States accounting for 169 million units. Those figures compare with 2006 shipments of more than 1 billion worldwide, and more than 160 million in the U.S., IDC said.
The U.S. market has about 230 million cell phone subscribers. Major wireless suppliers such as Cingular, Verizon, Sprint Nextel and T-Mobile are luring customers with replacement phones that claim to have the fewest dropped calls, as there are fewer new users and more competition.
In December 2005, Luxembourg's mobile phone penetration was 164 percent of the population. The rate in Hong Kong was 117 percent in September 2004. Even the United Kingdom is heavily saturated with 61.1 million units in 2004, exceeding the population of about 60 million, according to the World Factbook of the Central Intelligence Agency.
Penetration rates are also high in Japan and South Korea, but relatively low in China, India and Latin America, said Ramon Llamas, cell phone research analyst with IDC in Framingham, Mass.
Cost, malleability and durability are important, Llamas said. Users want a phone that is ``not just utilitarian'' and it ``needs to be inexpensive to sell well.''
Differentiation in design becomes critical. For example, what model might succeed Motorola Inc.'s ultrathin RAZR?
``Motorola designed an icon,'' Llamas said. ``That is an elusive thing to do.''
Llamas said phone developers are pursuing advances in shaping handsets and dealing with ways to resist cracking. ``These devices heat up,'' he said. ``What can we do to make plastic resin usable, durable, safe and cost efficient? That is still an open question.''
Batteries cause concern, and questions also remain about the adequacy of shielding from any electromagnetic wave and radio-frequency signal. ``Can these things cause long-term bodily damage?'' Llamas asked.
Compared with 2006's 36 percent increase, mobile phone sales in Asia will grow by 8 percent in 2007, according to a forecast of the Japan Electronics and Information Technology Industries Association of Tokyo. The forecast said the torrid 2006 rate of sales in India and China will slow, respectively, to 7 percent and 19 percent.
The association said manufacturers such as Nokia Oyj and Motorola are pushing less-expensive phone technologies for first-time buyers in China and India.