Worldwide mobile phone usage has doubled since 2000 according to the ITU, but IDC expects market saturation and lack of 3G interest to result in slower growth next year.
The International Telecommunications Union (ITU) reports that mobile phone usage has doubled worldwide since 2000, with developing countries leading the surge. However, lack of enthusiasm for 3G services will cause growth to slow in 2005 according to research firm IDC.
According to the ITU, there are now approximately 1.5 billion mobile phone subscribers worldwide, one quarter of the human population. That is a significantly faster rate of growth for the technology than landline service, which now totles 1.85 billion users a century after it was invented, as well as Internet service, which grew from 400 million users in 2000 to approximately 700 million users by mid-2004.
The bulk of the growth in mobile phone usage came from large developing countries, in particular China, India, and Russia. Such countries now account for 56% of all mobile phone users and 79% of the growth since 2000. China alone is now reporting 310 million users, one quarter its population yet larger than the population of the United States. India claims 44.5 million mobile phone subscribers, a 25% increase in 2004 alone. Russia, meanwhile, jumped from 36.5 million subscribers a year ago to 60 million as of September 2004.
Landline service has actually declined since 2001, according to the ITU, in part due to increasing use of VoIP services and in part due to cutthroat competition for international calls under new World Trade Organization regulations.
At least in developed markets, however, that growth will not continue to be so dramatic. Market research firm IDC believes that the 2.5G phone market has become saturated as most users have upgraded to phones with color displays and cameras, the most recent upgrade-driving features. However, 3G services are still evolving and for many users lack either the coverage or necessary services to convince them to upgrade to a new phone. 3G mobile phones will, according to IDC, account for only 18% of mobile phone shipments by 2006 and 25% by 2007. That slower growth rate and slow 2.5G to 3G transition will leave the mobile phone market weaker for a few years, absent a strong "demand catalysts".
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