European mobile phone sales drop for first time since 2001

Mature markets struggle with slow high-end handset sales and manufacturers face mid-market challenge

Nokia must improve usability and integration of new technologies to maintain its lead

Mobile phone sales in western Europe decreased 16.4 per cent to 35.9 million units in the first quarter of 2008, compared with the same period last year.

It was the first drop since 2001, when research group Gartner started tracking the market.

But worldwide sales reached 294.3m units, up 13.6 per cent on the first quarter of 2008.

Developed markets were the worst hit amid the economic uncertainty, said Carolina Milanesi, research director for mobile devices at Gartner.

“While sales in emerging markets continued to be driven by strong net new subscribers’ growth, mature markets felt the pressure of an uncertain economic environment,” she said.

“Sales of high-end devices in particular were lower as consumers turned to mid-tier devices when looking to upgrade their old phones."

"Phone manufacturers should strengthen their mid-tier offerings to cater to those users who might be reticent to invest too much money in replacing their old phone when the economic environment remains challenging.”

Nokia maintained its market lead, selling 115.2 million mobile phones in the first quarter of 2008. But to ward off increasing competition the company will have to improve usability and design and continue to integrate new technologies into its handsets, said Gartner.