Camera Phones, Color Screens To Spur Wireless Upgrades In '03

By Joseph Palenchar On Jan 9 2003 - 8:00am

Wireless-phone salespeople better be prepared to know a lot about digital cameras and computer technology if they want to sell the next generation of wireless phones.

In 2003, the number of phones with built-in digital cameras will proliferate as Audiovox, Nokia, Panasonic and Sony Ericsson ship their first models. All but Nokia are here at CES.

Two of the new camera phones — Sony Ericsson's P800 PDA-phone and Panasonic's GU87 — will be the first announced with digital zoom. They're on display.

The first phones equipped with EDGE (Enhanced Data Rates for Global Evolution) high-speed data technology will also be available in the U.S. when Nokia ships its first model. And dealers will find a greater selection of CDMA 1X phones equipped with Java or BREW (Binary Runtime Environment for Wireless) to download games, entertainment applications and business-oriented applications.

Dealers will also be able to choose from more color-screen phones than colors in the rainbow. The phones will be able to display photos, graphics, charts, games, and even wireless Web sites in color.

Many of the color-screen phones will be equipped with Multimedia Messaging Service (MMS), a standard that Ericsson said allows for the sending and receiving of text formatted in different fonts and sizes, graphics (including charts, tables, diagrams, maps, and sketches), sound (including music clips), and images. The images include digital pictures and PowerPoint-style presentations with integrated audio and video created on, and sent and received by, mobile devices such as PDA-phones. (see chart, right, for download times.)

In-Stat/MDR analyst Neil Strother estimated that a little more than 135,000 camera phones were sold in 2002, although most were phones with camera attachments. The first phone with a built-in camera in the U.S. was the Sanyo SCP-5300, which Sprint PCS started selling in November at $399.

In December, T-Mobile launched the Samsung V205 with integrated camera and MMS about two months after launching two phones with packaged camera attachments. One, the Sony Ericsson T300 with bundled camera, was promoted at $99 after a $50 rebate.

The camera-phones are appearing as carriers ramp up their promotion of new data services to reduce churn, increase airtime use and reach new demographic niches. The new phones and services, combined with an aging handset base, will help drive up handset sellthrough in 2003, analysts said.

Yankee Group analyst John Jackson, for example, told TWICE that he expects U.S. handset sellthrough to rise in 2003 by about 31 percent to 66 million-67 million from 2002's estimated 51 million, which was down from 2001's 52 million (see TWICE, Dec. 23, p. 74).

MMS, EDGE and other developments will contribute to the gain.

In MMS developments in 2003:

• AT&T Wireless will launch service early in 2003, following T-Mobile's launch in late 2002.

• Cingular will launch in the first half, "probably toward the end of the first quarter," said a spokesman.

• Sprint hadn't announced an MMS timetable at press time.

In EDGE developments:

• AT&T said it will complete national deployment of its EDGE network in the second half, but didn't say when service would be commercially available.

• Cingular will roll out EDGE commercially "piecemeal" in 2003 with close to 90 percent of its pops covered by the Christmas selling season.

• T-Mobile has begun installing EDGE and will offer commercial service in select markets sometime in 2003.

• Nokia said it expects to ship its first EDGE phone, the triband 850/1800/1900MHz 6200, in the first quarter. It'll also feature MMS and Java. Cingular said it expects to offer multiple EDGE phones from Nokia in 2003 and at least one from Siemens. In 2004, all Nokia GSM phones will be equipped with EDGE, Cingular added.