Growth in the Cell Phone Industry – Will the Bubble Burst or Bounce?

There is a lot of talk about the state of the cell phone industry these days and whether things such as video cell phones are helping the industry to grow or hindering it.

The answer, according to the numbers, is a healthy resounding “yes” to the continued growth in the cellular industry.

With projected numbers in the cellular industry are skyrocketing in the both domestic and abroad, there is no wonder why companies such as Cingular are competing with Verizon Wireless and others to put out better and more reliable cellular phones.

As it sits right now, nearly a billion new cell phones will be purchased by customers every year for the next few years. Tim Long, and analyst at The Bank of America predicts 650 million sales next year and 730 million new sets sold the year after(Source: “How Many Mobile Phones Does the World Need?” By Daniel Gross).

Forecasts into the future go even higher, with projections past 2006 reaching toward 1 billion cellular phones, wireless handsets, and video cell phones being sold annually. In the future, between one in 10 and one in 6 people on planet earth will own at least one phone or wireless handset.

And with people constantly buying and upgrading to newer models at a rate of a new phone every couple years, they are going to continue to buy cellular phones for a long time to come.

That’s a lot of new cell phones being bought and sold, don’t you think? One of the ways that manufacturing companies such as Mitsubishi and others such as Nokia are diving into the industry is to pack each new model of cellular phone with more features than their competitors.

You see the results every time you look at a cellular telephone or wireless service commercial: constant bombardment of new services, devices, and products, as everyone in the industry tries to show you why their product is the best there is.

Cell phone cameras are all the latest rage right now, as are PDA cell phones that mix your palm and pocket organizer and cell phone into a single piece of equipment. These cell phones will soon make use of other technologies as well, and the world is starting to see how effective a camera – PDA phone can be for getting all of your affairs in order, taking and sending pictures for your loved ones, and organizing your contacts and phone numbers for you.

Right now, the pressure is on for companies such as LG and their competitors at Motorola to put out video phones, phones with mp3 players, and other cellular phones with built-in features meant to lure customers.

As these phones become more computerized, they are starting to gain more features and aspects of computers that some people may be more familiar with. As a result the cellular industry continues to boom.

PDA phones come with hard drives and processors, for example, and most phones these days are made with at least a little bit of RAM locked away for storing things like pictures, ring tones, and other goodies available for download.

Text messaging is now a standard feature on most new cellular phones, and you can even communicate with computers through popular peer to peer messaging programs such as MSN Messenger.

The seamless integration of this technology will most likely also occur with video conferencing, “G3” internet access for wireless handsets and video cell phones, and other services/features that are currently just a few short years away.

They get a lot of help from cellular phone providers by making package deals and limited partnerships with them. That way, they can offer deals directly to the customer through their cellular phone provider.

If a company like Sony Ericsson hooks up with MCI or another company such as Sprint PCS, they can offer special discounts. That way you buy the phone they want, and the cellular phone carrier gets you locked into a contract that serves both your needs and theirs.

All of this handshaking and deal making can make for a very turbulent market place. Cellular phone companies such as AT&T and their competitors at WorldCom are constantly buying each other up and joining together to form new or bigger cell phone companies.

Throughout the industry, the same thing is happening with companies who make cell phones like Kyocera and others such as Audiovox.

Adam Smith knew that in an open market system such as this that ultimately it would be the consumers who reaped the real benefits as merchants fought for their business. This is exactly what we are seeing in today’s cellular phone industry.

All of these different companies such as Nextel and others such as Voicestream are competing for your service, while manufacturers such as NEC and others such as Panasonic are so eager to have you buy their phones that in many cases they offer them through cell phone carriers or distributors at substantial discounts to you – even giving the phone away for free so that you will sign on with one of their carrier partner’s deals.

You can pick and choose between many different companies and packages, and as these companies constantly undercut each other for business you will be paying less and less for more features with each new generation of cellular phones and carrier services.

The cell phone industry is most certainly on the verge of a bubble in growth sales and expansion. Countries such as Africa, Asia, and places such as Europe and North America are buying up all the cell phones they can get heir hands on. For now at least, that bubble is going to continue to bounce for cell phone carriers and manufacturers as cell phones become more and more prevalent in today’s society. That means nothing but sunshine and roses for you, the cell phone customer.

About the Author

Bill Schnarr is a single parent and freelance writer who makes his home in Calgary, Alberta. As well as having dozens of online and print publishing credits, he has recently reviewed numerous companies in the wireless phone industry. Look for him in the upcoming "Chicken Soup for the Single Parents Soul" due out in February 2005.

	Cell Phone Industry
Growth in the Cell Phone Industry – Will the Bubble Burst or Bounce?

Growth in the Cell Phone Industry – Will the Bubble Burst or Bounce?

About the Author

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