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Key cell phone markets are emerging

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Sept 11,2006
As global competition intensifies, cell phone makers here need to aggressively expand into emerging markets to regain lost ground, a report said yesterday. Emerging markets accounted for 57 percent of the global consumption of cell phones this year. That figure will rise to 62 percent by the end of 2009, according to the report by the Ministry of Information and Communication and the Institute for Information Technology Advancement. Emerging markets include Brazil, Russia, India and China. They also include other Asian countries and oil-producing nations such as Algeria, Nigeria, Iran and Saudi Arabia, the report said. Local cell phone makers such as Samsung Electronics Co. and LG Electronics Inc. are struggling in the face of competition from Nokia Corp. and Motorola Inc., the world’s No. 1 and No. 2 makers. Korea’s cell phone makers have been seeking a new source of revenue because they are facing local market saturation ― about four of every five people here carry a cell phone. VK Corp., a smaller cell phone maker, went bankrupt in July as it was unable to pay its mounting debts. According to market researcher Gartner Inc., Samsung Electronics, the world’s third-largest cell phone maker, saw its market share drop to 11.1 percent in the second quarter of this year, from 12.9 percent a year ago. LG Electronics’ market share also slipped 0.4 percentage points, to 6.3 percent over the same period. The sluggish performances prompted concerns that the local cell phone-making industry, one of the nation’s key growth engines, could lose momentum farther down the road. Many experts urge the companies to step up their efforts to unveil cheap and low-end cell phones in emerging markets, and not just focus on “premium strategies.”


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