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Nokia, Motorola widen lead as Asia demand spurs record sales

Nokia, Motorola widen lead as Asia demand spurs record sales
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First Published: Fri, Mar 02 2007. 03 35 PM IST
Updated: Fri, Mar 02 2007. 03 35 PM IST
Bloomberg
HELSINKI: Nokia Oyj and Motorola Inc., the world’s two largest mobile-phone makers, widened their lead in the market for handsets as demand in Asia lifted unit sales to a record in the fourth quarter.
Nokia’s market share rose to 36.2% from 35% a year earlier, researcher Gartner Inc. said in a statement. Motorola’s share climbed to 21.5% from 17.8%, while that at Samsung Electronics Co., the third-largest manufacturer, fell to 11.3% from 12.1%.
Gartner predicted global handset sales of about 1.2 billion units this year after shipments soared 21% last year, bolstered by emerging markets like China and India. Espoo, Finland-based Nokia and Schaumburg, Illinois-based Motorola also increased their market shares sequentially for the full-year as done by Sony Ericsson Mobile Communications Ltd.
“Overall, you see Nokia, Motorola, winning more market share,” Carolina Milanesi, principal research analyst at Stamford, Connecticut-based Gartner, said. “These two players are present in all regions, price points and technologies.”
Fourth-quarter unit sales jumped 21% to 284.2 million units, Gartner said. In 2006, shipments amounted to 990.8 million devices, an all-time high. Nokia benefited from having the widest portfolio even as it has been criticized for its mid-tier range, Milanesi said.
Nokia and Motorola have introduced new handsets aimed at winning market share in each others’ strongholds. While Nokia has focused on slimmer models, its US rival has concentrated on multimedia devices with music players and cameras.
Motorola’s profit margin at its phone unit shrank to 4.4% of sales in the fourth quarter from almost 12% in the previous three months as it cut prices to challenge Nokia’s lead in emerging markets. Profit margin at Nokia’s Mobile Phone division, its largest unit, climbed to 17.8% from 15.3%, excluding one-time items.
Milanesi said Motorola “lost steam” in the latter half of 2006 and it faces a “challenging” start for this year after Ron Garriques, head of its mobile-phone unit, left the company.
Sony Ericsson, which overtook LG Electronics Inc. as the fourth largest handset maker in the first quarter, boosted its share to 9% from 6.9% a year earlier. The London- based joint venture between Japan’s Sony Corp. and Ericsson AB of Sweden has attracted consumers with high-resolution cameras on its phones and handsets that use Sony’s Walkman brand and double as music players.
“It’s a safe portfolio, we would like them to diversify,” Milanesi said. The company may continue to increase its market share in the short-term, she said.
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First Published: Fri, Mar 02 2007. 03 35 PM IST
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