According to IDC, the top 3 handset manufacturers accounted for almost 70% of all traditional mobile phones shippedin EMEA during Q1 2006, compared to 62% in 2005. IDC describes this as a ‘polarisation’ of the market around the leading players. Andrew Brown, Program Manager for Mobile Devices at IDC, commented: “Operators’ scrutiny of handset portfolios is now beginning to significantly impact vendors without the capability and resources to meet stringent operator demands across multiple product lines with regard to software and hardware customisation, UI, and form factor design. Such vendors need to focus R&D towards operator requirements by integrating such components to produce closely positioned products that serve very specific segments.”

This is an interesting observation. Despite continued discussion about the emergence of Far Eastern manufacturers capable of under-cutting the big handset brands, the market data actually suggest it is the incumbents who are best able to respond to intensifying competition in the market. They may be suffering margin pressures, but their scale provides them with greater supply chain control and more scope to drive down prices at retail.

In EMEA at least, the major manufacturers are making it very clear they are willing to see falling ASPs to maintain market share.