IDC Finds Slower Growth in the Mobile Phone Market in 2007 While Samsung Captures...

IDC Finds Slower Growth in the Mobile Phone Market in 2007 While Samsung Captures the Number Two Position For the Year

FRAMINGHAM, Mass.--(Business Wire)--The worldwide mobile phone market passed a new milestone in
shipments by recording over 300 million devices shipped during the
fourth quarter, while experiencing slower year-over-year growth for
2007. According to IDC's Worldwide Mobile Phone Tracker, the 334.0
million handsets shipped during the holiday quarter was a new record
for the industry, and was up 15.3% over last quarter.

For the entire year, total shipments reached 1,144.1 million units
in 2007 with 12.4% overall growth. Nokia once again led vendors in
shipments throughout the year, although some shakeup in the vendor
rankings did occur. Samsung, which had been the number three vendor in
the industry, surpassed Motorola during 2007 to capture the number two
spot.

"Give credit to Samsung for taking the number two position
worldwide from Motorola," says Ramon Llamas, research analyst with
IDC's Mobile Devices Technology and Trends team. "For the past few
years, Samsung's growth kept pace with the market, but in 2007 the
company beat the market almost by a factor of four. Samsung
capitalized on replacement handset opportunities in the United States
and Europe with a steady stream of mid-range and high-end devices
while Motorola spent much of the year addressing inventory challenges
across EMEA and Asia. Now that Motorola is implementing a new handset
strategy, it will be interesting to watch the hotly contested number
two position in 2008."

"Over the last three years, growth in the industry during the
holiday quarter has fluctuated from 18.0% to 30.0%, and this past
quarter we saw it drop to 11.6%," said Ryan Reith, senior research
analyst with IDC's Worldwide Mobile Phone Tracker. "The expectation
that the market would maintain the level of growth it saw over the
last three years was unrealistic. We expect growth to be in the single
digits throughout 2008, and most likely for years to follow."

Top Five Mobile Phone Vendors

Nokia shipped more units in the fourth quarter than the next three
vendors' shipment volumes combined. This, Nokia executives pointed
out, was the result of its streamlined operations, which produced on
average nearly 1.5 million units each day during the quarter. This
number could have been even higher if the company did not have to deal
with component shortages during production. Regardless, it still marks
a significant accomplishment. Nokia's volumes were primarily driven by
entry level products from its 1100 and 1200 device families, but its
biggest revenue and profit generators came from its premium Nseries
devices.

Samsung achieved several noteworthy accomplishments to end 2007:
It took the No. 2 position worldwide for the year, posted its third
consecutive quarter as the No. 2 vendor worldwide, and recorded its
sixth consecutive quarter of shipment growth. In the process, Samsung
realized double-digit profit margins during the quarter, resulting
from an emphasis on its premium Ultra Edition phones and converged
mobile devices. Looking ahead to the first quarter of 2008, the
company plans to top its 46.3 million shipment volume while
maintaining profit margins.

Motorola spent another quarter addressing its challenges, the most
significant being a slowing demand for Motorola's products. CEO Greg
Brown pointed out that the company had missed out on significant
growth areas, most notably in 3G, China, and emerging markets, and
that gaps in Motorola's current product portfolio had to be addressed.
Recent announcements of its ROKR E8, Z10, and W series reflect
Motorola's attempts to revive its handset business, but recovery is
expected to continue into 2009.

Sony Ericsson broke through the thirty million unit mark for the
first time in its history. As in previous quarters, EMEA represented
the bulk of the company's shipments, but it also improved its presence
in North America, Latin America, and Asia Pacific. Even with greater
attention and resources going towards emerging markets, Sony Ericsson
still recorded the highest ASP among the leading vendors. Key devices
for the quarter included the K550, W200, W300 and the W580.

LG Electronics took another step towards breaking the 25 million
mark, and with the success of premium devices in developed markets and
cost effectiveness, the company also realized slight operating margin
improvement. Key to its success were several models released during
the quarter, including the Voyager and Venus in the United States, and
the Viewty in Europe. Despite its positive results during the quarter,
LG saw the distance between itself and Sony Ericsson grow to more than
seven million units, reversing the progress it had made in previous
quarters.

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Top Five Mobile Phone Vendors, Worldwide Q3 2007 Results
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Vendor 4Q07 Unit 4Q07 4Q06 Unit 4Q06 4Q07/4Q06
Shipments Market Shipments Market Growth
Share Share
Nokia 133.5 40.0% 105.5 35.2% 26.5%
Samsung 46.3 13.9% 32.9 11.0% 40.7%
Motorola 40.9 12.2% 65.7 22.0% -37.8%
Sony Ericsson 30.8 9.2% 26.0 8.7% 18.5%
LG Electronics 23.7 7.1% 17.7 5.9% 33.6%
Others 58.8 17.6% 51.5 17.2% 14.2%
Total 334.0 100.0% 299.3 100.0% 11.6%
---------------------- -----------------------------------------------
*T

Source: IDC Worldwide Quarterly Mobile Phone Tracker, January 25,
2008

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Top Five Mobile Phone Vendors, Worldwide Full Year 2007 Results
----------------------------------------------------------------------
Vendor 2007 Unit 2007 2006 Unit 2006 2007/2006
Shipments Market Shipments Market Growth
Share Share
Nokia 437.1 38.2% 347.5 34.2% 25.8%
Samsung 161.1 14.1% 113.7 11.2% 41.7%
Motorola 159.0 13.9% 217.4 21.4% -26.9%
Sony Ericsson 103.4 9.0% 74.7 7.3% 38.4%
LG Electronics 80.5 7.0% 63.5 6.2% 26.8%
Others 202.9 17.7% 200.6 19.7% 1.1%
Total 1144.1 100.0% 1017.4 100.0% 12.4%
----------------------------------------------------------------------
*T

Source: IDC Worldwide Quarterly Mobile Phone Tracker, January 25,
2008

Note: Vendor shipments are branded shipments and exclude OEM sales
for all vendors.

Mobile Phones - These small, battery-powered, voice-centric
devices utilize operator-provided cellular/PCS air interfaces for
voice communication. They are designed primarily, in both form factor
and feature set, for a compelling mobile telephony experience, but may
also include text-messaging capability. Mobile phones may include a
headset jack for hands-free operation as well as a variety of
features, such as personal information management, multimedia, games,
or office applications. Mobile phones exist at all points along the
form factor, price point, and feature set continua. Mobile phones that
combine voice communications capabilities with pen or keypad handheld
data features are tracked within the Converged Devices category.

For more information about IDC's Worldwide Quarterly Mobile Phone
Tracker, please contact Kathy Nagamine at 650-350-6423 or
knagamine@idc.com.

About IDC

IDC is the premier global provider of market intelligence,
advisory services, and events for the information technology,
telecommunications, and consumer technology markets. IDC helps IT
professionals, business executives, and the investment community make
fact-based decisions on technology purchases and business strategy.
More than 900 IDC analysts provide global, regional, and local
expertise on technology and industry opportunities and trends in over
90 countries worldwide. For more than 43 years, IDC has provided
strategic insights to help our clients achieve their key business
objectives. IDC is a subsidiary of IDG, the world's leading technology
media, research, and events company. You can learn more about IDC by
visiting www.idc.com.

All product and company names may be trademarks or registered
trademarks of their respective holders.

IDC
Ramon Llamas, 508-935-4736
rllamas@idc.com
or
Ryan Reith, 508-988-7902
rreith@idc.com

Copyright Business Wire 2008