Africa, Asia cushion mobile phones from slowdown

By Tarmo Virki

HELSINKI, March 31 (Reuters) - A continuing mobile phone boom in emerging markets in Asia and Africa mostly offset a drop in demand for expensive models caused by global market turmoil, a survey showed on Monday.

Handset makers sold 283 million phones in January to March, up 10 percent from a year ago, but down around 15 percent from the fourth quarter, which is usually boosted by Christmas holiday sales, according to a Reuters poll.

"On a global basis it should be a good, normal quarter," said JP Morgan analyst Ehud Gelblum.

In the last three years the phone market fell between 9 and 16 percent in the first quarter from the previous quarter, according to Strategy Analytics.

The world's fourth-largest mobile phone vendor, Sony Ericsson (6758.T: Quote, Profile, Research)(ERICb.ST: Quote, Profile, Research), whose forte is its strongly branded and relatively expensive Walkman music and Cybershot camera phones, warned on first-quarter profits earlier this month.

That followed a warning by chipmaker Texas Instruments (TXN.N: Quote, Profile, Research) of weaker demand for chips for high-end 3G phones, raising fears that the global economic slowdown was starting to crimp the handset industry.

"The volume in the high end of the market could be somewhat thinner, but this will not be dramatically visible in the overall market volume," said Jari Honko, analyst with eQ Bank in Helsinki.

In a Reuters poll, conducted with Inquiry Financial Intelligence, 18 analysts' estimates for first-quarter handset shipments varied from 270 million to 306 million reflecting uncertainties over market growth in Western Europe and China.