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Oyster Bay, NY - April 18, 2006 -

The mobile handset market looks set to take a  curious path over the next year as it is fuelled by two distinctly different forces. On one hand, the growing segmentation of saturated markets has prompted a rise in replacement rates. On the other hand, new subscriber additions in emerging markets continue to add to the baseline. These forces are examined in some of the key findings of the latest quarterly update to ABI Research's Mobile Devices Research Service.

Looking at developed markets, it is apparent that market segmentation has  gathered pace and the blurry lines between segments are beginning to solidify.

Co-author and principal analyst Stuart Carlaw comments, "the rise of the slimphone is a good example of the growing segmentation along less traditional lines. The success of Motorola's RAZR has spurred a whole new segment aimed at high fashion and slim design that looks set to realize product shipments in  excess of 200 million by 2008."

The report also points to the emergence of dedicated music and camera-centric devices as well as operator branded handsets as good examples of the added drive to tailor products to address valuable and affluent market segments.

The coming year looks set to be another strong one for net additions in growing markets although net additions-related handset shipment contributions are starting to slow. Report co-author Jake Saunders, ABI Research's director of global forecasting, adds that "manufacturers are increasingly bullish on prospects for the year and are all aiming for strong performances."

He goes on to note that "the market in 2006 will be fuelled by 3G and low cost handsets, and manufacturers addressing both of these segments look set to gain share."

Does this mean more gains for Nokia? Probably.