Some 412 million mobile phones were sold worldwide in 2000, a 45.5 percent increase over the previous year, a market research group said Thursday.
But the report by Dataquest Inc., a unit of Gartner Group, said sales began to cool toward the end of the year, and warned that companies are having a difficult time making profits.
“Persistent rumors of a market slowdown that dogged the industry throughout the year started to prove true toward the end of 2000,” said Bryan Prohm, senior analyst for Dataquest.
“The afterburners that propelled several years of consistently high growth rates now suddenly seem to have been switched off.”
Dataquest said there is “some significant stock carry-over to the beginning of 2001, meaning the number of total shipments in 2000 was about six million units lower than previous estimates,” Prohm said.
Nokia strengthened its lead as the leading vendor in the market during 2000 with shipments growing 66 percent, giving it a 30 percent share of the market. Motorola was second, with a 14.6 percent share, followed by Ericsson, at 10 percent.
But the manufacturers and analysts have warned that making handsets is not as lucrative as in the past.
“The long-term prospects for the mobile sector look tough,” said Dataquest’s Peter Richardson.
“Few manufacturers are able to generate healthy profit margins, placing the necessary investments in next-generation handsets developments at risk. The smart money may be riding on players that are unfamiliar with the upper echelon vendors,” Richardson said.