South Korean mobile phone makers continued a rapid move up the global market rankings during the third quarter, while growth in the wider mobile phone market slowed, a survey found on Wednesday.
Samsung Electronics and LG Electronics were the big winners, with LG overtaking Japanese Swedish joint venture Sony Ericsson as the world's fifth-largest handset maker, market research group Strategy Analytics said.
Samsung's global market share came within a hair's breadth of the world's No 2 maker, Motorola.
While Sony Ericsson grew slightly slower than its Korean rivals, it too closed in on Finland's Nokia, Germany's Siemens and US-based Motorola, underlining the steady gains of Asian producers.
Companies from Korea and Japan have been faster to integrate colour screens, photo cameras and other advanced features into their handsets, Strategy Analytics analyst Neil Mawston said.
"It has to do with the Japanese and Korean markets, which are more advanced. That kind of market demand is forcing handset makers to innovate much quicker," Mawston said.
This was underlined by the popularity of handsets with built-in cameras. In 2000 only 1 percent of phones sold in Japan featured a camera, compared with 95 percent in late 2003.
"They went from nothing to everything in just three years," Mawston said.
Korean and Japanese manufacturers were quicker than their rivals to put cameras in cheaper models, gaining share on market leader Nokia, which lacks a strong position in Japan.
GROWTH TO SLOW: Strategy Analytics said third-quarter shipments rose to 168 million units, up 25 percent from the year-ago quarter.
Mobile phone makers are expected to sell 670 million handsets to distributors this year, up from around 520 million units in 2003.
This is the result of booming demand from first-time mobile phone buyers in China, Russia, Brazil and India, while at the same time consumers in mature markets replace old handsets with new ones featuring colour screens and cameras.
The 30 percent growth rate in 2004, which has brought back memories of the 1990s when unit sales rose 50 percent or more every year, will slow to 8 percent to 726 million units in 2005 as replacement sales are already slowing down, Mawston said.
The research group does not expect a decline, which occurred earlier in the decade.
Nokia remained number one thanks to its strong position in cheap models but still suffered from a lack of attractive mid-priced models as its market share fell to 30.6 percent from 33.8 percent in the year-ago period.
Its share climbed slightly from the figures in previous quarters of 2004, however, as a result of steep price cuts.
Motorola's third-quarter market share slipped to 13.9 percent from 15 percent a year ago as it focused on profits over volumes.
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