July 2005

• According to ABI Research analyst Ian Cox, "Every Tier 1 service provider in fixed and wireless networks will announce SIP-based services running over IMS in the next six to twelve months. Any who don't, will be like airlines that missed out on the jet engine."

• Mobile operators will fight back to prevent any loss of business to BT's recently launched Fusion service which allows a phone to roam seamlessly between fixed and mobile networks, according to analyst firm ABI Research.

• "The mobile operators will not be standing still," said Jake Saunders, European research director at ABI.

• Mobile operators "will continue to improve coverage and intend to use 3G to reduce the underlying costs and increase the capacity of their networks."

• WiMax-certified products will be appropriate as alternative last-mile solution that compete with T1s and other telecommunications services, said ABI Research analyst Phil Solis.

• On the consumer side, "WiMax will bring broadband to places where it is not economically feasible to build out cable or DSL infrastructure," Solis added.

• From fewer than one million global mobile television and digital video content subscribers today, according to ABI Research forecasts, demand will explode so that by 2010 as many as 250 million customers will subscribe to video services on their mobile phones.

• What is now a $200 million business will by the end of the decade be a $27 billion one -- but the revenue from the services will be spread much more widely than in today's mobile ecosystem.

• According to a new study from ABI Research, annual global sales of "dual-mode" mobile phones -- which can connect to either a conventional cellular service or a Wi-Fi network -- are likely to exceed 100 million during the final year of this decade.

• ABI Research senior analyst Philip Solis said, “The advantages of dual mode handsets and services, when they arrive, can be summed up in two words: seamless and economical.”

February 2005 - Wireless Growth

• Mobile-phone penetration is expected to grow from 61 percent last year to more than 75 percent by 2010, according to a new report by The Diffusion Group.

• The report, "U.S. Mobile Markets: Analysis & Forecasts," forecasts more than 236 million U.S. consumers will subscribe to some form of mobile telephone service by 2010. The growth will be driven by continued expansion of 2.5-generation and 3G networks in metropolitan areas and new demand for improved access technologies that enable push e-mail and other services across converged networks

• The study also predicts 119 million handsets will be sold this year generating $17 billion in revenues, the average sale price of handsets will remain at about $145, and the youth market will provide the greatest opportunity for growth with the number of young subscribers doubling by 2010.

June 2005

• "Mobile marketing is ripe with promise and to some extent still surrounded by hype as well," said eMarketer Senior Analyst Noah Elkin. "But those looking to the wireless channel would do well to remember that it is still in an incipient phase. On the one hand, the staggering demographics of the global wireless market should not be discounted. On the other hand, the ways in which most people use their handsets continue to evolve, with voice still by far the most dominant application."

March 2005

• “Bluetooth has made a great deal of progress,” said Rob Enderle, principal analyst for the Enderle Group, based in San Jose, Calif. “Things are working much better now than historically.”

June 2005

• According to Forrester Research, 60% of companies using wireless technology report higher productivity and 40% see improved customer service. An additional 20% say wireless has helped their business improve logistics.

• According to Forrester Research, there are certain sweet spots where mobile technology tends to deliver the biggest and fastest benefits to the business. For example, providing warehouse staff with wireless access to inventory applications can make stock reporting more accurate and reduce the time taken to meet customer orders.

• "Our research suggests that companies that do not do this sort of upfront planning spend more than twice as much on mobile computing as a result," says Forrester analyst Carl Smiley. "Knowing what you need means you are less likely to spend money on unnecessary technology later."

• Regarding Wireless VoIP, Ellen Daley, a principal analyst for telecom and networks at Forrester Research says "Companies are starting to recognize that their cellphone bills are high, and they are looking for ways to decrease costs."

• Among the industries most interested in wireless VoIP to date are health care and retail, Daley says. The market overall has been small, she says, but will likely grow as the cost of dual-mode handsets (those that support both Wi-Fi and cellular systems) drops.

• In the US, almost half of doctors use a personal digital assistant (PDA), but most use the devices for personal information management rather than for clinical applications, according to a study by Forrester Research. Only 6 per cent use their PDAs to access patient records and just 7 per cent to order medications.

• Nationwide there has been a 6 percent drop in U.S. land lines from 2000 to 2004. Four percent of U.S. households say they have cut the cord altogether in favor of cell phones, but that number could swell to 12 percent by next year, according to a report released in May by Forrester Research Inc.

• A recent report from Forrester Research showed that over half the US marketers surveyed were interested in advertising on mobile devices.

• "Advertising over wireless is more complex than TV, radio, and the Internet, because of the fragmentation caused by handset diversity and the uncertainty of take-up rates of different mobile technologies like video and Java," said David Kerr, Vice President of Strategy Analytics.

• A survey by Forrester Research Inc. of nearly 900 large organizations, including various levels of government, determined that the public sector is the leading adopter of mobile IT when compared with large private-sector companies.

• Government applications are clearly different from private-sector applications because the public sector uses so much more paper than other user groups, so devices such as handhelds and laptops that are connected wirelessly can provide a real benefit, notes Carl Zetie, an analyst at Forrester.

• According to the Mobile Plans Index developed by Forrester Research, the financial services industry -- usually a voracious user of emerging technologies -- is among the slowest to adopt mobile IT, while the usually conservative government and health care sectors are well ahead.

• To make it an even more complicated matrix, Forrester analyst Carl Zetie says we have to consider the different needs of three types of mobile applications that may be used within the same industry or company: those for field workers, those for roaming information workers, and sensors for asset or inventory management. At the moment, these applications are all sprouting up on an ad hoc basis as "isolated islands of mobile functionality" within the enterprise, Zetie says.

• According to the Forrester report, "US Mobile Growth Defies Conventional Wisdom," two-thirds of U.S. households have at least one mobile phone, in which 5,600 households were polled. The study found that most households have more than one phone, and households with four or more mobile phones grew by 57 percent during the past year.

• "The wireless market continues to defy predictions that it is approaching its saturation point," said Charles S. Golvin, Forrester Research principal analyst.

• Golvin added that “Despite carriers' focus on improving their networks and customer service, customer satisfaction has declined over the past three years and hovers around 50 percent in key categories like customer service and call dependability."

• The report mentioned the top three mobile carriers will own seven out of 10 mobile households. Cingular will have 28 percent. Verizon will have 27 percent. And Sprint/Nextel will have 15 percent.

• Forrester reported that price, battery life and ease of use continue to drive customers' purchasing decisions, while less than 10 percent of subscribers rated camera phones as important to their purchase decisions. However, data functions are becoming more important, with 29 percent of consumers saying data capability plays into their buying decisions.

• The report found 18- to 24-year-olds are the most likely age group to own mobile phones, and less than half of people who are 65 years or older own mobile phones.

• Forrester says that it predicts that total traffic from all mobile messaging types will grow by 92% over the next five years in Europe, mainly from person-to-person short message service (SMS) both this year and at the end of 2010.

• Revenues from SMS, mobile multimedia messaging service (MMS), video messaging, instant messaging presence services (IMPS*), and mobile email will only grow by 10% - to US$27 billion by the end of 2010 - as unit prices drop.

• Michelle de Lussanet, Principal Analyst, Telecom Markets at Forrester says: "This year, the average European mobile subscriber will send 40 messages (of any type) per month. This number will nearly double in five years, to 72 per month. By then, Europeans will collectively exchange more than 23 billion mobile messages each month. SMS will remain the biggest traffic driver. Much of the growth will come from youngsters - 10- to 15-year-olds - who increasingly own mobile phones and almost 80% of whom use SMS. No other messaging service will beat SMS's combination of low price, simplicity, accessibility, and usability."

• Pan-European MMS revenues, however, will grow strongly - and explode ninefold in the next five years, to more than US$6.4 billion per year by 2010.

• Video messaging uptake will be slow due to its high cost; but even if each person sends just two per month in 2010, they will generate almost US$1.3 billion - 56 times as much as today.

• IMPS revenues will grow the fastest, accounting for 8% of total mobile messaging revenues in 2010 - more than either mobile email or video messaging.

May 2005

• Mobile phone manufacturers sold 180.6 million phones between January 1 and March 31, an increase of 17 percent over the 153.7 million sold in the first three months of last year, according to market analysts at Gartner.

• The top three manufacturers now control over 60 percent of the market, compared to 57.7 percent a year earlier:

• Nokia sold 54.9 million phones in the quarter, 10.7 million more than a year earlier, giving it a 30.4 percent share of the market, up from 28.8 percent a year earlier, according to the study. Nokia sold over one-tenth of its phones in China, a success which Gartner attributed to significant investments in marketing and distribution networks there.

• Motorola sold 30.3 million phones, boosting its share of the market to 16.8 percent from 16.3 percent in the first quarter of 2004. Samsung Electronics' share climbed to 13.3 percent and that of LG Electronics to 6.2 percent.

• Gartner estimates there will be three billion mobile subscribers in the world by 2010, a doubling of current subscriber levels.

• The largest proportion of growth will come from the Asia/Pacific region, whose subscriber base will characteristically have lower incomes and demand cheaper handsets. This means the mobile and wireless industry will need to produce a large number of low cost handsets, with a fraction of the functionality that we see today.

• Gartner predicts that by 2009, 20% of enterprise buyers will source fixed mobile convergence instead of buying communications services separately.

• Nick Jones, Research VP and Gartner Fellow, offers the following words of cautionary advise to CIO's, "The emergence of operator convergence and bundling strategies will undoubtedly offer opportunities for enterprises to save money. However, CIOs should not be fooled into being locked into one operator or indeed being tempted into subscribing to bundled services they do not need, just because the price seems attractive."

• Gartner predicts that through 2006, 70 percent of mobile workstations and devices used outside the office will not be backed up sufficiently to restore users to full operability in less than one week.

• Gartner analysts and vice presidents Phil Redman and Bill Kirwin said that businesses must begin wireless projects by finding a metric to define their success.

• Redman estimated that wireless PDAs cost $4,422 a year over two years to purchase and manage. The total cost of ownership for a mobile phone on the other hand is much lower, $1,272 per user per year over two years.

February 2005 - 3GSM

• CANNES, France-3 GSM networks added more than 13.5 million net users last year, representing an annual growth rate of more than 500 percent, according to The GSM Association.

• Sixty operators in 30 countries offered 3GSM services at the end of the year, with a total of nearly 20 million subscribers.

June 2005

• Susan Kevorkian, an analyst with IDC, said there are some consumers who want to load their phones up with features like music, games and video, but plenty of others still prefer devices like the iPod that do one thing, and do it well.

• "We think there's going to be a very large middle area where people will use both types of devices," she said.

• IDC's Kevorkian said there may also be problems with competing formats for wireless downloads. Customers might purchase a download for their phone, but they may not be able to play it on another MP3 player.

• With regards to in-flight cell phones, analysts at technology group Ovum welcomed Fusion as a breakthrough in technology, but said getting the pricing right will make or break the new service.

• While global shipments of cell phones in 2004 grew 34 percent to 692 million, 2005 will see an increase of just 20 million units, the market researcher predicted.

• According to IDC, the boom in 2004 was driven by strong sales of cell phones, with features like cameras and color displays.

• IDC expects that by the end of 2005, the world's cell phone subscribers will total 1.7 billion.

• "Strong demand from emerging markets, the attraction of color displays and camera-enabled mobile phones and delays in 3G network availability made 2004 a banner year for 2.5G mobile phone shipments," David Linsalata, an IDC analyst for mobile devices, said in a statement. The market will continue to expand through 2009, he said, albeit slowly.

• IDC anticipates that by 2009, over 30 million U.S. wireless subscribers will be consuming commercial video/TV content and services over their wireless devices.

• "Although there are substantial challenges facing the commercial video and television marketplace from a network, handset, and content perspective, which will serve to keep penetration levels relatively low, IDC anticipates that annual revenue will still top the $3 billion mark by 2009," said Lewis Ward, senior research analyst in IDC's Wireless and Mobile Communications program.

• The total number of minutes of commercial video content consumed will more than double annually between 2004 and 2009.

• IDC anticipates the total volume of wireless minutes consumed will rise into the tens of billions by the end of the forecast period.

• Shipments of PDAs declined by 13 percent in 2004, according to IDC, the third successive year of negative growth for the PDA market.

• The 2004 figure marks a five-year low for PDA shipments, which have not been below 10 million units since 1999, IDC said. Shipments have been on a steady decline since the industry hit its peak in 2001.

• A lack of “compelling solutions” beyond the usual personal information management (PIM) and integrated GPS receivers was cited by IDC as part of the reason why PDA vendors are not able to expand.

• David Linsalata, analyst in IDC's Mobile Devices program, said despite a rise in quarterly shipments due to holiday seasonality and consumer uptake of bundled and integrated GPS receivers, increasingly saturated markets and stiff competition from converged mobile devices drove the handheld device market to its third straight year of decline.

• “This drop stresses the urgent need for vendors to evolve their devices beyond personal information management in order to return the market to a growth path”

• Alex Slawsby, a mobile analyst for IDC, said that there are over 1.6 billion cell phone users worldwide, and that the vast majority of them bought phones for personal use with their own money.

• Sales of Bluetooth chips increased by 34 percent last year, to $490 million worldwide, and are expected to nearly double this year, to $800 million, according to IDC.

• And the number of Bluetooth-enabled cell phones shipped last year grew to 87 million, or about 13 percent of all cell phones sold worldwide, from 43 million in 2003. That number will balloon to 180 million this year, IDC said. Enderle Group.

• IDC reports that the European mobile devices market, including PDAs and smart phones, grew 30 percent year on year in the final quarter of 2004. Shipments of smart phones and telephony-enabled PDAs continued to witness the highest rates of adoption with year-on-year growth of 41percent. Converged devices constituted 72 percent of the total market in the fourth quarter.

• “Replacement cycles, contract renewals, and sustained consumer demand for new 'must have' devices ensure that the mobile devices market maintains healthy year-on-year growth, regardless of wider economic conditions such as the downturn in consumer spending witnessed in December 2004,” said Geoff Blaber, research analyst for European Mobile Devices at IDC.

• Vendor Highlights
  • Nokia — Nokia remained market leader in 4Q with a share of 41%. Despite falling from 47% in 2003 in the face of increased competition in the smart phone arena, the Finnish vendor remains the dominant force with the most extensive R&D program and product portfolio. In line with IDC's predictions, Nokia had a strong finish to 2004, largely due to new product introductions such as the 6260 and WCDMA 6630 in the Series 60 category, as well as the long-awaited Series 80 9500 communicator.
  • HP — Although HP witnessed flat year-on-year growth in 4Q, the vendor continues to dominate the handheld market with total 2004 growth of 19%. HP has been successful in implementing a new product portfolio, providing a range of closely-positioned solutions across both consumer and enterprise segments, in order to sustain growth of its standalone PDAs. In 2005, IDC is watching the progress of HP's converged devices such as the 6340 with interest, as an indicator of the future direction and success of the business.
  • palmOne — In response to a rather disappointing showing in 3Q, palmOne enjoyed a significant improvement in shipments in 4Q, to total 273,000. With a substantial focus on the consumer market, extensive GPS bundling across the product range from the Zire to the T3 ensured demand remained buoyant. However, with negative growth of -13%, the uptake of the Treo 650 and further commitment to converged devices in 2005 is likely to be central in stabilizing the decline of market share in Western Europe, which fell to 9% in 2004.
  • Motorola — Motorola had its most successful quarter to date with shipments of converged devices exceeding 232,000, representing year-on-year growth of 54%, but most significantly, almost doubling total shipments from 1Q04 to 3Q04. Sales were largely driven by a heavy push of the remaining MPx200 inventory and the vendor will hope the successor, the MPx220, will continue the momentum in 2005. The popularity of the 3G A1000 Symbian UIQ device and the long-anticipated arrival of the MPX further suggests that 2005 will see Motorola increase its standing in the smart phone market.
  • RIM — Sustaining the phenomenal growth enjoyed throughout 2004, 4Q saw the Canadian vendor end the year with growth in excess of 900% from 2003, pushing total shipments for 2004 beyond 420,000. Following such dramatic success in 2004 with the BlackBerry push email solution, the bar has been raised in 2005. The dual challenge for RIM is to continue to lead the messaging market in the face of increasing competition from alternative push email vendors, while ensuring its hardware keeps pace with the development of increasingly complex competitor smart phones.

May 2005

• According to an Insight Research report, US network operators are expected to add subscribers at a compounded rate of 2.9% between 2005 and 2010.

June 2005

• In M:Metrics' monthly Benchmark Survey, 24.58 million US mobile subscribers, or 13.6% of the market, downloaded a ring tone in April.

• "Although ring tone consumption still skews young - two-thirds of ring tone downloaders are under 34 - our data shows subscribers across all age groups are downloading ring tones to personalize their phone," says Mark Donovan, senior analyst at M:Metrics. "Indeed, the idea of ring tones as a fashion statement is prompting many to buy multiple ring tones. More than 60% of subscribers who downloaded a ring tone downloaded two or more, and more than a third downloaded three or more ring tones in the month of April."

• M:Metrics' Syndicated Mobile Market Measurement Service interviewed a voluntary panel of 180,000 wireless subscribers. Of the sample studied, 58% said they use their devices for more than just voice.

• 31 percent of female subscribers and 34 percent of male subscribers report having played a mobile game in the previous month. The study found that male subscribers are 60 percent more likely to download mobile games, possibly because most games available are action- and sports-oriented.

• M:Metrics also concluded that those over 25 years old accounted for 45 percent of all subscribers who downloaded ringtones wireless users are increasingly likely to download ringtones and use text messaging, realms of mobility widely associated with the youth market.

• Over half-52 percent-of subscribers age 25-34 sent or received text messages in the previous month, while 37 percent of those age 35-44 communicated via text. Among younger subscribers texting is ubiquitous with 68 percent of those age 18-24 sending and receiving text messages. “Even older folks are getting into the act,” observed Donovan. “Fourteen percent of those over 65 use text messaging.”

• The M:Metrics report also indicated that more than 60 percent of subscribers who took a picture with their camera phone also sent a photo message to another phone or email address in the previous month

• While the overall penetration of photo messaging is still low at 7 percent, Sprint has taken an early lead with 12 percent of its subscribers sending a photo to another mobile subscriber.

• 13 percent of mobile subscribers reported accessing news and information via a mobile browser in the previous month. Marked gender difference characterized mobile browsing with 17 percent of men subscribers and 9 percent of women subscribers using their mobile phones to access news and other information.

• Browsing activity was driven by a need for context-sensitive information. Over half of all browsers sought weather information (57 percent), and more than 40 percent of browsers accessed maps and directions (41 percent), sports scores and sports news (44 percent), national news (44 percent) and movie and entertainment listings (40 percent).

March 2005

• Dominance in telecom is steadily shifting away from traditional wireline companies to wireless -- a trend that's affecting the market for telecom equipment as well, says Standard & Poor's analyst Kenneth Leon, who covers the wireless-services and -equipment companies.

• Growth in wireline is definitely slowing, he says, and many customers are using their wireless phones for long-distance calls while retaining a wireline connection for local service. Between 10% and 15% of the total market is now using wireless exclusively, Leon says.

• The leaders in wireless service, he adds, include Verizon Communications (VZ ), Sprint (FON ), and Cingular, a joint venture of BellSouth (BLS ) and SBC Communications (SBC), and for international markets Vodafone (VOD ). On the equipment side Leon's top recommendation is Qualcomm (QCOM ), the leader in CDMA technology.

• Q: Who looks best in wireless equipment these days?
  A: Our top recommendation is Qualcomm (QCOM ), which is the market leader for CDMA technology. This is the only company that enjoys pricing power in the industry. The company is well positioned with its intellectual property on CDMA, for which it gets paid royalties on chipsets and handsets that are shipped around the world. Because of the company's unique position, we see Qualcomm as similar to the position that Microsoft (MSFT ) enjoyed in the 1990s.

• We expect revenue growth greater than 20% with net margins near 35% in 2005. We also see strong free cash flow and cash at the end of the year approaching $9 billion with no debt. We see Qualcomm as a core position in a technology portfolio. With the recent weakness in equipment stocks, including Qualcomm, we would buy Qualcomm shares.

• Wireless handsets grew 33% in 2004 over 2003, and we're projecting handsets in terms of unit shipments to grow 10% in 2005. What's driving growth is new market penetration in emerging countries such as China, Southeast Asia, India, Latin America, and Eastern Europe, as well as a high replacement cycle for handsets in developed markets like Japan, Korea, Western Europe, and North America.

• According to Pablo A. Perez-Fernandez, senior telecommunications analyst with the Stanford Group, “Different people are going to need different capabilities. All phones will have access to some common features like e-mail. Some phones will be optimized for data entry. Some will be optimized for media playback. Some phones will be optimized for storing and retrieving large amounts of data.”

• Perez-Fernandez said the major factors are aligned to create quick adoption of smart-phones. “The bottom line is that smart-phones are going to get increasingly cheaper, push e-mail and other mobile data services more affordable, and consumer uptake will quickly follow,” Perez-Fernandez said. “I expect this process to take two to three years at the maximum.”

June 2005

• A new report from Strategy Analytics, "Advertising on the Fourth Screen: Opt-In To Dominate Mobile Marketing Spend," expects mobile marketing to remain only a niche revenue opportunity, representing just 2% of the projected $47 billion online advertising spend in 2010.

• Although momentum is building in the mobile advertising and marketing arena, barriers remain before the sector can take off, according to Strategy Analytics.

• However, Senior Analyst Nitesh Patel noted, "Although there is growing interest in wireless from parts of the marketing community, take up will be tempered by weak consumer response rates, skepticism about the effectiveness of mobile advertising vis-a-vis traditional channels, (like TV and direct mail), and carriers' reluctance to compromise their position as the premium content delivery channel."

• David Kerr, Vice President of the Strategy Analytics Global Wireless Practice, added, "Advertising over wireless is more complex than TV, radio, and the Internet, because of the fragmentation caused by handset diversity and the uncertainty of take-up rates of different mobile technologies like video and Java. We expect sponsored video and audio services to grow strongly over the next five years capturing 17 percent of total spend by 2010, while browser based advertising will claim the greatest share with 44 percent."

• Strategy Analytics found that mobile phone sales in the eurozone fell by 8 per cent in the first quarter. Shipments across Western Europe fell to 37 million units, from 41 million units in the same period last year.

• Phones as Music Devices
  With regards to music on wireless, wireless firms could run into problems, analysts say.

• Most users would rather manage their music libraries via their PCs, not their cell phones, says Nitesh Patel, analyst at Strategy Analytics.

• "Carriers will struggle to gain share, given the premium price of mobile downloading over fixed Internet downloads," Patel said.

• Patel says wireless firms can try to make inroads in the music market by forging ties with music labels and offering subscribers special deals, perhaps on concert tickets.

• "The technology is there to play music on phones," said Strategy Analytics researcher Eddie Tapiero. "But the business model isn't, and that's what carriers need before this is a mass market.

• Analysts at Strategy Analytics reported that slow cell phone subscriber growth, particularly in emerging markets in the Americas and Asia, has diminished worldwide demand for wireless handsets.

• Report author Neil Mawston said the slowdown is due in part to less robust economic conditions worldwide.

• During the first three months of the year, Strategy Analytics reported, 172 million handsets shipped. While that's a 10 percent increase from the previous quarter, the sales increase during the same period last year was 44 percent.

• According to research from Strategy Analytics, 257 million camera phones were shipped worldwide, representing 38% of total handset sales, in 2004. This was up sharply from 84 million, or 16% of total, in 2003.

• Camera phones outsold digital still cameras by almost 4 to 1, reaching just 68 million units globally in 2004. Sales grew 40 percent annually, from 49 million units in 2003.

• Neil Mawston, Associate Director of the Wireless Device Strategies (WDS) service at Strategy Analytics, said "Nokia led the pack, with an 18% worldwide market share, followed closely by Motorola at 17%, and Samsung in third position at 13%."

• Chris Ambrosio, Director of Strategy Analytics' Global Wireless Practice, added, "The digital still camera market is running out of steam. Vendors such as Kodak, Canon and Fuji will find growth harder to achieve in 2006. Camera phones will eventually capture 15 percent of the low-end digital still camera market by 2010, while attempts to sell households in developed markets a second or third device will be restricted by the ubiquity of multi-megapixel camera phones."

May 2005

• The Yankee Group has announced that the mobile virtual network operator (MVNO) market in the USA will reach US$10.7 billion in service revenue by 2010.

• By 2010, the MVNO market will be comprised of three subscriber tiers totaling 29 million customers. Several large MVNOs will make up the first-tier accounting for 24 million subscribers. The second tier will be comprised of medium MVNOs, accounting for 2.5 million subscribers. A dozen small MVNOs will make up the third market segment, accounting for 2.5 million subscribers.

• "The growth of the MVNO market has great potential to influence the long-term viability of the wireless industry," said Marina Amoroso, Yankee Group research analyst in the Wireless/Mobile United States (WMUS) Decision Service.

• For mobile handset vendors, Asia-Pacific is the largest regional market in the world and holds the greatest potential, accounting for more than 40% of global handset sales and mobile users.

• From 249 million units in 2004, Yankee expects handset sales in Asia-Pacific to peak in 2006 at 265 million before slowly declining to 237 million in 2009. This trend is in line with subscriber growth patterns as the rate of market expansion begins to slow.

• Annual net additions in the region are already in decline: from 158 million in 2004, we expect only 100 million net new users in 2005.

• Although mobile penetration remains below 25% across the region, most Asian markets will reach saturation at a much earlier stage compared to Japan or Western Europe due to relatively low incomes.

• However, average mobile penetration in these three markets is only 17% and will remain below 35% during the next 5 years.

• Between 2005 and 2009, 1.26 billion mobile phones will be sold in Asia-Pacific. China will account for the bulk of the region's sales with 557 million units, followed by Japan with 252 million units and India with 138 million units.

• At least 35 million American workers could benefit from mobile e-mail access, according to the Yankee Group, but fewer than 2 million use it today. “Whether enterprise IT executives and decision-makers realize it or not,” said analyst Eugene Signorini, “the majority of their mobile workforce has an inherent requirement for wireless access to e-mail.”

• XJ Wang, a senior analyst in the Yankee Group's wireless/mobile technologies practice, sees mobile search engines as a potential killer app because mobile search can leverage the personal information that mobile networks already have in subscriber files.