Gartner Inc. said the mobile phone industry experienced better than expected sales in the first quarter, as worldwide mobile phone unit sales totaled 112.7 million units, an 18% increase from the
first quarter of 2002. Nokia Corp., with a 35% market share in the first quarter of 2003, continued to have more than double the market share of its nearest competitor. Despite market share of more
than 50% in almost all GSM markets in Europe and Asia/Pacific, Gartner analysts said Nokia is still positioned to grow market share in these core markets through the remainder of the year. The
remainder of 2003 will see Motorola and Samsung Electronics battle for the No. 2 position, while Sony Ericsson and LG Electronics will try to hold the No. 5 position. Both South Korean vendors are
solidly entrenched in leadership positions in the CDMA segment, and both continue to make inroads into GSM markets across the globe. While the worldwide mobile phone industry has reason to be excited
by 1Q 2003 results, Gartner analysts said there are several risks unique to 2003 market supply and demand dynamics that could impact the industry during the second quarter, as well as the rest of the
year. Gartner analysts have also expressed concern over the number of vendors trying to compete in the mobile phone industry. There are more than 100 manufacturers now competing in the global market,
and this will result in downward pressure on average prices for mobile terminals as companies struggle to survive and resort to competing almost solely on price.