Have we peaked too soon?
Apr 07, 2003
An oversupply of CDMA handsets in China is likely to erupt this year as Nokia, Motorola and several South Korean handset makers scramble to ramp up production to further penetrate the world’s largest mobile phone market.A recent Digitimes report notes that it is estimated that domestic handset demand in China will reach about 65 million units this year, of which 15 million units will be CDMA handsets. China Unicom, the country’s largest CDMA mobile phone service provider, had 7.17 million CDMA subscribers as of the end of last year and is expected to add 13 million CDMA subscribers this year, according to an earlier Bloomberg report.On the supply side, Motorola, the only foreign company with a license to produce CDMA handsets in China and the largest handset vendor in the country, expects to increase its CDMA market share to 50% from about 40% last year, according to the China-based news site eNet.Samsung Electronics, the world’s largest CDMA handset vendor, plans to boost full-year CDMA handset production from six million to 10 million units this year at its factory in Shenzhen, Guangdong Province (China). The South Korean vendor held a 25% share of China’s CDMA market last year, eNet reported.LG Electronics (LGE) hopes to gain a 30% share of China’s CDMA market, and TCL Mobile Communication targets 20%, the report added.The potential oversupply situation is not seeing any relief as Nokia announced early this week that it will begin making CDMA handsets in China this year for sale to the local market. The handset giant, which supplied one in every three handsets sold worldwide last year, has about a 10% share of the global CDMA market.Source: DigiTimes