Handset, mobile content sales hurt by credit crunch

The ailing economy is taking its toll in the mobile industry, on both the handset and content sectors.

Handset sales declined 0.4% this quarter over Q2, and grew just 3.2% over last year's Q3, according to data from IDC research.

This is significant because the Q3 is typically a busy time of year for handset vendors, as they load their sales channels in anticipation for Q4's holiday buying season. As a result, sales rates usually experience double-digit growths during the quarter.

IDC has predicted handset sales growth to remain slower through 2009, although there is some hope for the industry given that market-leaders such as Nokia have forecast positive 2008 results.

The content sector is facing tough times as well, particularly the mobile gaming industry.

Nokia's head of gaming told Reuters that the overall industry is likely to stagnate in 2008, and the effects could be even worse in 2009.

The mobile gaming industry experienced little to no growth in 2007, according to research produced by Informa.

Nokia plans to launch its re-branded N-Gage service in China by the end of the year, and ramp up its N-Gage marketing campaigns in India.

The mobile gaming industry could be buoyed by Wednesday's announcement that EA intends to launch several of its hottest properties - FIFA 09, Spore Origins and Monopoly Here & Now - for the N-Gage in time for Christmas sales.

One area that has so far escaped the effects of the credit crunch, at least in the US, is the data services sector.

SNL Kagan is predicting that mobile data revenue will increase at a CAGR of 16% over the next ten years.

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