Mobile Phone Sales Show First Decline

Global mobile phone sales dipped below 400 million units in 2001, the first decline in the history of the industry, which recently has seen a reshuffle among second-tier manufacturers, research group Gartner Dataquest said.

Overall sales to consumers declined by 3.2% to 399.6 million mobile phones in the full year, a marked difference from the 60% average growth rate from 1996 to 2000.

Sales were hurt by saturated markets in Europe, the removal of subsidies by telecom operators, a burgeoning secondhand market in developing countries and a gray market of unlisted imports from overstocked distributors wanting to reduce inventories, said senior Gartner analyst Bryan Prohm.

On top of that, handset makers and operators failed to introduce new features that could persuade consumers to replace their handsets with new, more expensive ones. Meanwhile, the slowing economy crimped consumer spending.

Market leader Nokia recovered all ground it had lost earlier in the year. The Finnish company ended the year with a 35% market share, up from 30.6% in 2000.