Wireless Handsets Ready For Liftoff

By Joseph Palenchar On Jan 8 2004 - 8:00am

Handset suppliers and retailers are looking forward to the launch of new network services and technologies in 2004 to maintain handset sellthrough momentum.

"We believe all sales channels are benefiting from the advent of new handsets with exciting new features," said a Cingular Wireless spokesman. "There are more choices for consumers, more features to captivate their attention, and more ability to match products and services to customers' unique needs, all of which have the potential to boost sales activity."

Sellthrough picked up in 2003 because of renewed net-new subscriber growth and growing replacement sales, driven in large part by the popularity of color screens and integrated cameras and by the rollout of advanced non-voice services, suppliers and carriers said.

"Handset growth, along with new subscriber growth, has been healthy in 2003," Cingular said. "We expect continued growth in adoption of new handsets as more legacy-network [2G] customers make the jump to our advanced network."

In 2004, suppliers hope to step-up the upgrade pace with the first megapixel camera-phones (from Samsung and Kyocera), a greater selection of push-to-talk (PTT) phones (from such companies as Nokia, Samsung, and Kyocera), and high-speed data models equipped with EDGE.

Last October, according to the NPD Techworld's Cell Track survey, replacement sales accounted for 84 percent of all phones sold to consumers. Phones with integrated cameras accounted for 15 percent of unit sales.

Wireless local number portability (WLNP) will help boost replacement sales in 2004. Based on a recent consumer survey, market researcher Telephia determined that 6 percent of wireless subscribers intend to switch carriers because of WLNP. That's on top of another 15 percent who said they intended to switch even without WLNP.

If the 6 percent follow up on their intentions, they would buy about 9.2 million handsets in the coming year, given the mid-December subscriber base of 153 million estimated by CTIA. Publicity over Wi-Fi hotspots will also help boost sales of high-speed data services, said Paul Chellgren, Nokia senior VP of product management and business development.

For the industry as a whole, sell-through in 2003 grew about 10 percent to around 80 million units, said Samsung senior VP Pete Skarzynski in late November. He expects handset sales to increase 10 percent in 2004 to around 90 million units, with dollar volume growing around 8 percent.

At CES, dealers will find a handful of the phones that will help make that growth possible. They include models from the following companies:

Kyocera: The company is expected to talk up a new version of its cdma2000 1X Slider phone and its plans for a 1.2-megapixel camera-phone due later in the year with a "revolving" form factor. The company might also outline its plans to bundle Qualcomm's BREW-based push-to-talk (PTT) application with upcoming phones.

Details about the new camera-phone and PTT plans haven't been disclosed, but the new Slider SE47 became available to consumers through U.S. Cellular at $119 and MetroPCS at $219.

Its predecessor, the Slider V5 MTV edition, is bundled with MTV content.

LG Mobile Phones: One of LG's newest phones, the clamshell LX5450, features embedded VGA camera, 262K color screen, built-in mirror for taking self-portraits, and self-timer. It weighs less than 4 ounces and features external LCD screen for customizable caller ID.

AllTel is offering it at $149.95 with a one-year contract and $99.95 with a two-year contract.

Motorola: The company's latest camera-phone, the V600, is a quad-band GSM phone with 4x zoom, ability to record 10-second videoclips, ringtones and flashing colors assignable to specific callers, POP3/IMAP4 e-mail support, and talk time up to 450 minutes on standard battery. The company's other two camera-phones are the V300 and V500, which also began shipping in the fourth quarter of 2003.

Samsung: The company is promising about three dozen handsets in 2004, including Samsung's first embedded megapixel camera-phone, first hybrid GSM/CDMA world phone, and a phone with speech-to-text conversion. Also planned: a handset with embedded Wi-Fi and the company's first EDGE handsets and first keyboard-equipped phones.

Sony Ericsson: It plans to show a new PDA-phone and an imaging phone.

The T630 imaging phone is a triband GSM/GPRS world phone due in the first quarter. The back side features digital camera and small mirror for taking self-portraits. The other side features a 65K TFT color screen.

The new Symbian-based P900 smartphone, also due in the first quarter, is smaller and faster than its predecessor, the P800, and incorporates such upgrades as video recording, 65K color touch screen instead of 4K, a flash-memory increase to 48MB RAM from 32 MB, and more gaming features.

Like its predecessor, the P900 will be sold on the SonyEricsson Web site at a price that hasn't been determined. Its predecessor retailed for $650 on the company's site with activation.

Wildseed: The company will show its latest swappable SmartSkin cellular-phone housing, which features content based on the rock group KORN.

SmartSkin technology uses chip-embedded themed faceplates that consumers swap to change the phone's cosmetics, screensavers, ring tones, games, stored videoclips, and stored one-click web links to related content, including chatrooms, sweepstakes, and quizzes.

The first SmartSkin-capable phone, the curved GSM/GPRS Identity model from Korean maker Curitel, is expected to be available from a U.S. Carrier sometime in 2003.