Consumers in emerging markets aren’t showing signs of slowing their cell phone buying, according to the latest report from Stamford, Conn.-based market tracker Gartner Inc.
Worldwide sales totaled 294 million cell phones in the first quarter, up nearly 14% from the same period a year earlier, Gartner’s data showed.
Most of the sales growth came from new subscribers in India, Asia, Africa and Latin America, where folks are snatching up inexpensive phones.
Each of those regions showed 20% or higher sales growth rates year-over-year, according to Gartner.
That’s good news for Orange County companies such as Irvine’s Broadcom Corp., Aliso Viejo-based Smith Micro Software Inc., Aliso Viejo’s Networks in Motion Inc. and Anaheim’s Multi-Fineline Electronix Inc.
The companies make chips, software and other parts for mobile phones and related devices.
Sales in “mature markets”,the U.S., Japan and Western Europe,are giving researchers pause.
Fewer consumers in those regions bought phones this year. The ones who did opted for the less snazzy models.
Western Europe saw cell phone sales drop more than 16% in the first quarter, the first decline for the region since Gartner began tracking the market in 2001.
“Mature markets felt the pressure of an uncertain economic environment,” said Carolina Milanesi, Gartner research director for mobile devices in Britain. “Sales of high-end devices in particular were lower as consumers turned to mid-tier devices when looking to upgrade their old phones.”
Japan saw sales of cell phones fall 10%. North America saw an increase of about 2%.
“In North America, new subscriber levels were low, implying that the weak economy may be having a negative effect on the wireless handset market,” said Hughes De La Verne, principal analyst for mobile research at Gartner’s Dallas office.
Roughly 90% of cell phone sales came from people replacing their old phones, he said.
No New Taxes
Trade representatives from the U.S. and Japan are taking a stand against taxes on imports of certain tech goods imposed by the European Union.
U.S. Trade Representative Susan Schwab requested formal dispute settlement talks on the issue of applying tariffs on new technologies, including computer screens, multifunction printers and television set-top boxes that can access the Internet, according to a Reuters report.
PC maker Hewlett Packard Co. and other big industry names have argued that “EU tariffs violate the spirit and the letter” of the World Trade Organization’s 1997 Information Technology Agreement, which slashed tariffs to boost trade.
“The EU should be working with the U.S. to promote new technologies, not finding protectionist gimmicks to apply new duties to these products,” Schwab said at a press conference in Washington, D.C., according to Reuters.
As the new high-tech devices have come to market, EU officials said they were not covered by the WTO agreement and imposed tariffs of up to 14%, the report showed.
The European Commission said it “strongly rejected” the arguments and said that as new technologies evolved the U.S. had the right to invoke a “review clause” to renegotiate the terms of the trade agreement, which wasn’t meant to only cover older technologies, Schwab said.
“If ITA participants only provided duty-free treatment to products with the technology that existed at the time the ITA was concluded, very few ITA products would be eligible for duty-free treatment today,” she said.
Business War Games
Masters of business administration students at the University of California, Irvine’s Paul Merage School of Business faced off in a cutthroat business strategy competition last month.
The event, UC Irvine’s third annual, is dubbed Business War Games.
Four teams of students took on hypothetical roles as executives from AT & T; Inc., Google Inc., Intel Corp. and the investment arm of Seattle’s Vulcan Inc., which was started by Microsoft Corp. cofounder Paul Allen.
The students were tasked with coming up with a winning strategy for each of their companies to make money from wireless Internet technologies.
There was more at stake than a virtual company’s future, though,the game served as the students’ final exam.
They were judged by a panel of executives from Intel, AT & T; and Verizon Communications Inc. The teams were evaluated based on four criteria: insight; accuracy in presenting their strategy; creativity; and ability to project a sustainable strategy.
The winners were the Intel group, which had a strategy focused on high volume chip manufacturing for wireless Internet access and using Intel’s ability to make chips faster and cheaper than the competition. They also created a brand, “Intel Wireless Inside” to capture market share.
Earlier this year a similar event was held in the East, where four top business schools,University of Chicago Graduate School of Business, Northwestern University’s Kellogg School of Management, Harvard Business School and Massachusetts Institute of Technology’s Sloan School of Management,battled over the same topic.
My Bad
There was an error regarding an item about Irvine software maker Thunderhead Inc. in the May 26 column.
One of Thunderhead’s competitors should have been mentioned as Lexington, Ky.-based Extream Software Inc.
