500 Million Camera Phones in 2005

Time to thump the drum again.

There's going to be over 800 million mobile phones sold this year, and over 500 million of them will have cameras, according to this article over at InternetWeek. The numbers are projected to climb to over 90% of the 1 billion phones sold a year in 2009.

Think about it. A half a billion network enabled multimedia handsets sold this year alone. Compare this to the roughly 800 million PC Internet users out there and you start to see what's happening. Yes, many of these phones are only 2.5/2.75G with 40kbps - 100 kbps data speeds, the phones aren't very powerful or use closed systems and their users are saddled with expensive cellular data plans. But that's not going to last for long - in fact, it probably won't last another 18 months. 3G networks are being rolled out world wide, consumers are changing their phones every 16 months on average and competition among carriers is driving down data prices. The mobile market you see today will look very little like it will by Christmas 2006.

Look at this article about Vodafone's new aggressive 3G push in Australia. Not only is it in the carrier's best interest to move their customers to third generation networks because they cost so much less to operate, but as a differentiator, data services are an attractive marketing tool. But Vodafone is also using price pressure as well to compete with other earlier entrants to the 3G game. This is going to be repeated around the world. We saw it last year when DoCoMo had to offer flat-rate data plans to compete with KDDI, and we're going to see it again in every other market as well.

Camera phones is just the beginning. The other metric to watch is multimedia-enabled phones (read: Music). Whereas camera phones require data-enabled handsets but can work easily on 2.5G networks, music and video phones pretty much require 3G. Watching the growth in that market will show the next stage in mobile data services. Here at home, the fact that Sprint, Verizon and Cingular all now offer music-enabled mobile phones actually shows quite a bit about the maturity of the U.S. mobile market, which I stil hear people describe as "behind". Not as much as it used to be.

Fun stuff...


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