Mobile Communications Market to Increase by Double Digits in 2012

The market for mobile communications is expected to increase by double digits during 2012, according to a new study by IHS.

As revealed in the study, revenue for mobile communications equipment during 2012 will climb to $398 billion, marking a 17 percent jump from last year’s $340.8 billion, according to the IHS iSuppli Wireless Systems Market Tracker report from IHS. Predicted growth for 2012 in the segment is lower than the 32 percent jump seen last year, but still the market “shows no signs of declining anytime soon,” IHS said in a press release. In addition, factory revenue in the sector will be more than a half trillion dollars by 2015.

The items considered as part of the study include mobile communications equipment, such as smartphones and other handsets, as well as routers.

LTE is credited with fueling much of the future growth, IHS said. “LTE provides much faster access speeds and lower latencies than current 3G technologies, making real-time applications like video streaming and multiperson gaming not only possible, but usable,” Francis Sideco, senior principal analyst for wireless systems at HIS, said. “Because of this, both consumers and wireless providers are embracing LTE. The transition to LTE is driving growth both on the consumer and infrastructure ends of the wireless business in 2012 and beyond.”

In addition, 4G cell phones will represent $21.7 billion of the total mobile market revenue during 2012, IHS said. Revenue for 4G cell phones will rise by 372 percent in 2012 compared to $4.6 billion in 2011. In addition, 3G expansion will slow to 17 percent during 2012. The 1G/2G handset is still popular for markets in developing countries, but because it has a lower average sales price, its revenue will be less than 3G or 4G during 2012, IHS said.

It was also reported that Beceem Communications and Sequans Communications S.A., are moving away from a rival 4G technology, WiMAX, in favor of LTE. Also, two mobile handset original equipment manufacturers—Samsung Electronics and Motorola — are now making their own LTE chips.

In addition, Apple’s iPad and other devices will lead to tablets to grow by more than 70 percent in 2012 over 2011, the study said. Also, some carriers in the developed world have started to migrate to 4G LTE networks.  

The report also predicts more metro cells, which could be mounted on public facilities like malls, railways and subway stations, so users can access smartphones or tablets. Moreover, it was estimated that 4G wireless infrastructure will be about $36 billion in factory revenue by 2015.

In other recent company news, IHS reported in November that many component suppliers will get “significant” revenue from the Kindle Fire, such as Texas Instruments, which has all of the major integrated circuit slots in the design.