The cellular handset market is expected to be very exciting over the next few years. One part of the handset market that will be a driving force in the future will be the camera phone segment.
Historically, Japanese cellular subscribers have been especially receptive to more features added to their handsets. Although the cellular handset market in Japan is up 27% in 2005 (to 52 million units) as compared to 2002 (41 million units), the Japanese digital-camera-equipped cell phone market has more than doubled, growing from 19 million units in 2002 to 47 million units in 2005!
Although the Japanese market was the "early adopter" of the camera phone, it is estimated that the Japanese market will represent only about 13% of the total demand for camera-equipped handsets in 2005, down from 95% just three years earlier in 2002. One of the pleasant surprises in the cellular phone industry over the past couple of years has been the significant popularity of the camera phone outside of Japan.
In 2009, camera-equipped cellular phones are forecast to represent almost three-fourths of the total handset market, up from about 45% in 2005 (Figure 1). Nokia alone is expected to ship over 100 million camera-equipped handsets in 2005. Moreover, the quality of the camera in the cellular handset is increasing dramatically.
In early 2002, most camera phones offered 300,000-pixel images. In 3Q03, Sony Ericsson's leading-edge MovaSO505i handset was equipped with a built-in camera featuring a resolution of more than one million pixels. In May of 2004, Casio introduced a camera-equipped cellular phone that offered 3.2 million pixel autofocus imaging capability. Samsung began shipping its SCH-770, the world's first 7.4 million-pixel camera-equipped cell phone in mid-2005! This handset was priced at over $900.
The high-resolution (i.e., >1Mpixel) versions of camera phones are forecast to go from representing only about 4% of the 2004 camera phone market to almost 95% of the market in 2009. Moreover, most of the high-resolution camera phones sold in 2009 are expected to have >2Mpixel capability.