July 20, 2005

According to a Gartner survey, sales of cellular and mobile phones are to reach a billion annually by the end of 2009, when nearly 40 percent of the world's population will own at least one mobile handset.

Asian countries will continue to play a major role in increasing the number of cell phones in circulation to 2.6 billion by 2009, the research firm estimated in the report, released Tuesday.

Currently, 25 percent of all cell phones are sold in Asian countries; by decade's end, that number will be one in three, Gartner analysts said.

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Overall, the findings bolster the cell phone's status as the world's most popular electronic device.

Mobile handsets have already eclipsed cameras, personal computers and even traditional landline phones in sales.

Gartner's predictions come with an important caveat: Wholesale prices for handsets have to decrease from an average of about $174 each in 2004 to about $161 by 2009.

In the United States, especially, handsets are typically discounted so heavily that they end up costing consumers nothing. Operators can only afford to continue to do that, and keep sales growing, if the price they pay for each one drops.

While Asia is taking the lead, the sales pace is a global phenomenon, whether it's in Latin America or China--where cell phones are a relatively new phenomenon--or in European countries saturated by phones and where replacement sales will flourish, Gartner said.

"The sales volume can't be attributed to one region in particular," wrote Carolina Milanesi, Gartner's principal handset analyst. "It's a truly global phenomenon."

Gartner also noted that sales of smart phones, cell phones that pack more advanced features, will represent about one-fifth of all mobile handset sales by 2008.

That's good news for the likes of Symbian, Microsoft and other cell phone operating system makers, which are banking on the smart phone market taking off.

Source: C-Net News