Smartphones - Beyond Voice to Information and Entertainment

Investments in shares of wireless technology companies and wireless service providers have been particularly profitable in the post-dot com era. The wireless industry is in a sweet spot of the technology space. Bountiful business opportunities exist as wireless usage continues to increase in both developed and emerging markets. And driving this usage higher are new products such as smartphones whose capabilities are being augmented by the deployment of third generation (3G) wireless networks.

Feature-Rich Smartphones.

Smartphones are more than mobile phones. A smartphone is a mobile phone with built-in functions of a personal digital assistant. Smartphones pack a diverse range of features and functionalities into the handset that makes them a mobile information center and entertainment device for the user.

Smartphones commonly include features such as web browsing, e-mail, and multimedia capabilities. Certain models have enough horse power to run complex software applications such as enterprise customer relationship software and car navigation programs.

A full-featured QWERTY-type keyboard, MP3 player, and Geo Positioning Systems capability are becoming common among higher-end smartphones. Instant messaging is a cool feature making its way into the mainstream.

Smartphones, A Growing Segment of the Handset Market.

Smartphones represent a small, yet rapidly growing, segment of the handset market. According to Strategy Analytics, smartphone sales at 17.5 million units in 2004 accounted for 3% of the worldwide sales of 684 million handsets. However, this represents a significant jump from the 8.2 million units sold in 2003.

The demand for smartphones is projected to grow rapidly in the coming years. By 2009, the number of smartphone units sold is estimated to reach 125 million or 16% of total handset sales worldwide. This implies a 48% compound annual growth rate in smartphone unit shipments over the 2004-2009 period.

Smartphone Early Adoption Led by Asia and Europe.

Adoption of smartphones has been particularly rapid in Asia and Europe. The aggressive deployment of advanced wireless networks in these regions has encouraged early adoption of smartphones.