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Industry experiences worst decline in mobile phone shipments

Two reports have been released today showing a sharp decline in shipments of mobile phones.

Two separate reports have painted a bleak picture of the mobile phone industry, showing that it has experienced its fastest reduction in handset shipments since records began.

Strategy Analytics released a report today reporting that global shipments fell by 13 per cent in the first quarter of 2009 to 245 million units. At the same point last year the number was 282 million.

Neil Mawston, director of Strategy Analytics, said: "The first quarter of 2009 was an exceptionally tough period. Shipment growth contracted for all the top five major vendors, forcing some of them, such as Nokia, to rein in costs and slash thousands of jobs."

The report blames the recession for the steep decline.

Alex Spektor, an analyst for Strategy Analytics, added: "A global economic downturn and cautious de-stocking by retailers caused the slowdown. Our records indicate that Q1 2009 represented the fastest ever decline in annual shipment growth since the modern cellphone industry began in 1983."

The report did, however, confirm that the smartphone market is still going strong. Apple's iPhone unit sales went up by 123 per cent to 3.8 million, up from 1.7 million units in the first quarter of 2008.

Samsung was the highest achiever out of the five biggest phone vendors with its market share rising to 19 per cent, the highest in its history.

A similar report issued by analyst IDC today showed even worse figures. It reported a decline of 15.8 per cent reduction in shipments which translates as a drop from 290.8 million phones to 244.8 million.

Ramon Llamas, senior research analyst with IDC's mobile devices technology and trends team, said: "That the worldwide mobile phone market started off 2009 with a year-over-year decline highlights just how much the economic recession has affected all industries, including the wireless market."

He does, however, believe that new features and high demand for new phones will help the industry through but he also said: "We expect to see further year-over-year declines worldwide, even as some regions show signs of improvement," he concluded.

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