Businesspeople shun 3G as shipments boom

Despite its rocky start, 3G could yet turn out to be both popular with consumers and telcos alike, with analysts predicting third generation technology will drive the handset market as shoppers scrabble to get the latest in cutting edge devices.

Analyst house IDC predicts that the market for mobiles in Western Europe will grow at a rate of 12 per cent over 2005, with both 3G and smart phones slated to do particularly well in the coming months.

Third generation phones have already benefited from the operators' end-of-year launch spree coinciding with Christmas shopping, with a healthy fourth quarter bringing the number of 3G handsets sold in 2004 to 144 million.

WCDMA 3G phones are now expected to make up 13 per cent of all phone shipments during 2005, according to IDC.

However, despite warnings by consumer magazine Which?, the buying spree is being driven largely by average shoppers rather than the business segment, with most operators only offering the Nokia 6630 as a token gesture towards a third generation smart phone.

Andrew Brown, programme manager for mobile devices at IDC, said the notable absence of 3G phones in operators' line-ups is proof that businesses just don't see the need for 3G devices, adding that currently there are more smart phones that come equipped with Wi-Fi capability than with WCDMA 3G technology.

3G or not, smart phones are set to make a small but very significant jump in market share during this year, from four per cent to over six per cent.

The rate of growth for the smart phone market is set to outstrip that of standard mobiles, IDC predicts, with year-on-year growth rates of 40 per cent for converged devices in 2004, compared to 18 per cent for standard mobiles.

2005 will see that growth rate rise to 70 per cent, the analysts believe.