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Taiwan's Shipment of Smartphones to Decline in Q4

2008/11/21 | By Steve Chuang

Taipei, Nov. 21, 2008 (CENS)--Taiwan's smartphone makers may see their total shipment edge down 0.4% from the third quarter to only 10.98 million units in the fourth quarter, in a sharp contrast to an estimated increase of 17.9% in global shipment, according to reports issued by the Market Intelligence Center under the government-funded Institute for Information Industry.

What's worse is that Taiwan's smartphone shipment is expected to sharply drop by over 20% to a range of 8 million and 9 million units in the first quarter of next year.

MIC analysts noted that smartphone sales in the global market are estimated to surge 34.5% to 217 million units in 2009 from 161 million units to be sold this year, with a penetration rate to rise to 16.4% from 12.7%. In 2012, the rate will even hit 28.5% worldwide, indicating the sale booms in the segment will last into the following years.

However, the shipment decline in the fourth quarter of this year has given an alarming call to Taiwanese smartphones. Affected by declining orders from Apple for iPhones, Taiwanese smartphone makers are expected to see their combined global market share fall to 21.1% in the fourth quarter from 24.9% posted in the third quarter.

MIC pointed out the risky concentration on developing models using Microsoft's Windows Mobile operating system will very likely endanger Taiwanese smartphone makers, as competing operating systems, including Android and Symbian, will become free of charge in the future. In other words, besieged with royalty fees of Microsoft's operating system, Taiwanese makers may become inferior to rivals in cost efficiency.

MIC suggested that Taiwanese makers shift their focus onto development of smartphones based on Google's Android platform, because global sales of Android phones are estimated to sharply soar to between 4 million and 5 million units next year from 700,000 units this year. Apparently, Android will become one of the mainstream operating systems for smartphones in the world.