Growing handset sales suggest recovery in UK mobile market

For the first time in nearly two years sales of mobile handsets in the UK have posted three consecutive months of year-on-year growth suggesting the recession which has been affecting sales may be lifting.

According to research from GfK Retail and Technology the months of April, May and June 2010 showed positive growth with June achieving a 6.8 per cent increase over the 2009 figure. GfK ascribes these positive results to the ongoing success of the postpaid contract sector which, because of the continued demand for smart phones, has only been in decline twice in the last twelve months. The main factor which has been holding the market back has been the ongoing fall in prepaid sales which were only positive for one month, April, over the last year. However, a series of successful below-the-line promotional activities across the industry has pushed the prepaid market back into growth, taking the total market with it, says GfK.

The future remains uncertain however, according to GfK: highly anticipated new product launches look set to continue to drive the contract market into growth, but the prepaid market may fall back into decline without sustained promotional activity. In addition, the effects of the shift of many customers from 18 month to 24 month tariffs in 2008 are now coming through and it may well be that the total market will slip back into negative growth later in 2010.

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