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Dual-mode Wi-Fi and cellular phones to grow

Dual-mode Wi-Fi and cellular VoIP phones are poised for huge growth, while mobile and single-mode phone sales continue to climb.

Dual-mode Wi-Fi and cellular VoIP phones showed phenomenal growth last year and, according to recent research by...

Infonetics Research, that growth will continue through 2010 with a compound annual growth rate of 198%.

The massive shift is fueled by users wanting a greater breadth of services on devices and stronger offerings from mobile operators and service providers.

"Users are demanding single number/single device services, and operators like T-Mobile announced converged services based on Unlicensed Mobile Access (UMA) in 2006," said Richard Webb, Infonetics directing analyst for wireless. "UMA is a good example of early fixed-mobile convergence, prior to the eventual shift to IMS [integrated multimedia services] in the long term."

Along with strong projected growth for dual-mode phones, Infonetics found that mobile phone sales hit $115.5 billion in 2006, and Wi-Fi phone sales topped $535 million. On the mobile side, that was a 13% growth from 2005; for Wi-Fi, $535 million was a 327% jump from the previous year.

For more information
Why you should prepare for convergence

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Falling prices and growing demand for both mobile and Wi-Fi VoIP phones will continue this year, according to Infonetics. Worldwide, shipments of mobile handsets rose 27% between 2005 and 2006, while single- and dual-mode Wi-Fi sets combined skyrocketed 489%. From 2007 to 2010, mobile handset shipments will grow another 26%, Infonetics forecasts, and Wi-Fi shipments will increase by a massive 1,300%.

"More operators are transforming into [IMS] providers, creating converged mobile, wireless LAN and VoIP solutions that support voice and data services across enterprise, public and home networks," Webb continued." "The appeal of such converged services is driving Wi-Fi phone adoption, especially in dual-mode Wi-Fi-cellular handsets."

Dual-mode is expected to explode, but single-mode Wi-Fi-only VoIP phones are also selling strongly, driven mostly by such vendors as SpectraLink, D-Link, Linksys and Netgear.

In 2006, 2G/2.5G GSM handsets made up 49% of worldwide mobile phone revenue; the rest was made up of 2G CDMA, W-CDMA and CDMA2000 handset sales. Also, worldwide mobile subscribers -- both enterprise and consumer -- are estimated at 2.5 billion in 2006, a 26% jump from 2005. The number of mobile subscribers is expected to rise 42% to 3.6 billion by 2010. Of all mobile subscribers, 9% are from North America, 47% are from Asia Pacific and 36% are from EMEA.

For Wi-Fi handsets, Cisco led in the single-mode revenue market last year, followed by SpectraLink. Samsung led in dual-mode Wi-Fi-cellular revenue, followed by Nokia.

Last year, 71% of Wi-Fi phone revenue was from dual-mode handsets; the remaining 29% was from single-mode Wi-Fi VoIP handsets. North America led in worldwide revenue for single-mode Wi-Fi phones, while Asia Pacific led in revenue for dual-mode Wi-Fi-cellular phones.

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