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3G UMTS Phones Poised to Grab Market Share

27th May , 2004

Europe : The deployment of UMTS services in Europe will boost global sales of UMTS handsets from a 2003 level of 4 million units to more than 15 million by the end of 2004.

Inset is the LG U8100 3G UMTS phone currently on sale via 3G Operator 3.

This finding, by New York-based technology market analyst ABI Research, has implications that extend up and down the production chain for the new devices.

The second-generation UMTS/WCDMA handsets now starting to appear in the marketplace almost always include features such as enhanced color displays, applications or media processors with advanced video encoding and graphics capabilities, and dual cameras, along with increased memory to store the content these new capabilities generate. Some of these devices also have integrated WiFi and GPS capabilities.

UMTS handsets will have to compete on price as well as feature-sets. Earlier UMTS chipsets were discrete solutions which drove the prices of handsets up, but the latest offerings have reduced that impact by integration and by migration to cutting edge process technologies such as 0.09u. According to Alan Varghese, Senior Director of Semiconductor Research, in the near future it will not be the UMTS modem that contributes to the handsets' higher cost, but all the included applications and peripherals that the higher data rates enable.

The new integrated chipsets also consume less power, which means that the new handset models provide talk times in the order of three hours, and standby times approximating 200 hours. The use of such chipsets is said to reduce the number of parts in a handset by about 30%, with correspondingly lower costs.

With savings of this kind now becoming available, the market for UMTS handsets markets can be expected to evolve as rapidly as services become available. These market trends, and others, are analyzed in detail by two ABI Research subscription services, Wireless Handset Quarterly Service, and Wireless Handset IC Quarterly Service.

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