The world's mobile phone market will grow at much slower-than-expected rates next year as consumers put off buying new devices due to deepening economic concerns.
Market analysts UBS have downgraded the firm's forecast for 2009 global handset growth from 6% to 3%, and is expecting the European and North American markets to be particularly hard-hit.
UBS analyst Maynard Um told Reuters the firm is convinced there is a strong correlation between world GDP and sales of consumer devices.
He cited UBS cutting its forecast for 2009 global gross domestic product growth to 2.2% from 2.8% for his own reduced handset estimate.
JPMorgan analyst Ehud Gelblum was more optimistic, but still cut his expectations for 2009 handset growth to 6.1% from 8.1%, citing consumer reluctance to upgrade phones, particularly in Europe, and 'more modest' growth in China, one of the fastest-expanding mobile markets, the Reuters report said.
Nokia warned early last month that the cell phone market would be hurt by weakening consumer confidence in many markets in 2008 and the company itself would lose market share in the third quarter.
Um said fourth-quarter results from handset makers would likely show that Nokia, which commands a roughly 40% share of the global market, is not the only one suffering.
'As we enter Q4, we believe it will become clearer that many handset vendors are struggling rather than problems being specific to Nokia,' he said.
Analysts pointed to Samsung Electronics, which trails only Nokia, and Motorola, the No. 3 mobile phone maker, which has been struggling to regain its footing since the start of 2007.