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North America Handset Growth Slows
Posted: 08-Jun-2005 [Source: Strategy Analytics]

[Strategy Analytics reports Q1 North American handset results showing Motorola remained overall market leader while Nokia continued to lose ground in the GSM replacement market to Motorola, Samsung and LG.]

Boston -- According to Strategy Analytics' latest report, "North American Handset Market Q1'05," LG Electronics' balanced product mix and strong carrier relationship management allowed the Korean vendor to open a 7 point market share gap in the North American CDMA market. Motorola, however, remained the overall market leader in the North American market with a 34 percent market share in the first quarter of 2005.

"As we expected, growth is slowing rapidly as the color upgrade cycle loses steam and operators hesitate to aggressively subsidize camera phones," states Chris Ambrosio, Director of the Wireless Device Strategies service. "The fragmented and ultra-competitive CDMA market does not afford any one vendor a lasting dominant share position, but LG's surging performance in GSM shows product and distribution balance that is a precursor to leading competitive participation in US market."

David Kerr, Vice President of the Wireless practice noted, "Samsung is severely limited in its ability to ramp volumes faster than the market due to its continuing weakness in the profit driving mid tier. Samsung's refusal to move beyond its initial high-end only strategy is reminiscent of the myopia shown by Nokia in not jumping on the color and clamshell bandwagon."

Other findings from this Strategy Analytics "2005 North American Handset Market Update":

a) Nokia share fell 7 percentage points to 13% as the vendor lost out in the GSM replacement market to Motorola, Samsung, and LG.

b) Motorola remained the overall market leader accounting for 34% of the overall market sales. Motorola's well-timed GSM portfolio diversification has driven it to a dominant share lead at Nokia's expense.

c) Further consolidation appears likely as Panasonic, NEC and Siemens have all found NA to be hugely challenging while Kyocera is at a critical transition point.

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