Pause in 2G Spending Leads to Largest GSM Revenue Decline Ever

Huawei & ZTE enjoy major market share

In a recently published report by Dell’Oro Group, a trusted source for market information about the networking and telecommunications industries, the worldwide mobile infrastructure market revenue contracted 9 percent year-over-year in the first quarter of 2009 despite a record number of 3G base station shipments. The GSM market experienced its largest year-over-year decline as Chinese mobile operators focused on 3G network deployments.

“The three Chinese mobile operators plan to spend over $20 billion this year on rolling out the initial phases of their 3G deployments,” stated Scott Siegler, Senior Analyst at Dell’Oro Group. “China Unicom’s WCDMA deployment is shaping up to be the single largest 3G deployment in history and was the primary contributor to the most ever – 100 thousand – Node B shipments in the quarter. With the CDMA market declining elsewhere around the world, China Telecom’s spending resulted in the most CDMA base station shipments in over four years. As the two GSM operators, China Mobile and China Telecom focused their spending on the rapid deployment of their 3G networks, spending on their GSM networks significantly declined. We expect this spending to accelerate in the second half of the year,” finished Siegler.

During the quarter, Huawei and ZTE experienced the greatest rate of growth, almost doubling their combined share of the total infrastructure market to over 20 percent compared to the same quarter last year.

GSMA briefs:

China’s Huawei and ZTE experienced the greatest rate of vendor growth in the mobile network equipment market during the first quarter of 2009 according to research firm Dell’Oro Group, almost doubling their combined share of the total infrastructure market to over 20 percent compared to the same quarter last year. Huawei in particular had an extremely strong quarter, roughly doubling its market share to 15 percent, making it the third-largest mobile network vendor in the quarter. Market-leader Ericsson continued its dominance, expanding its share slightly to 33 percent of the market in January-March, while closest rival Nokia Siemens Networks saw its share drop to 21 percent from 24 percent a year ago. Alcatel-Lucent lost third place to Huawei, with a 2 percent fall in market share, to 14 percent. Beleaguered vendor Nortel Networks saw its market share halve, to 4 percent. Dell’Oro noted that total worldwide mobile infrastructure market revenue contracted 9 percent year-over-year in the quarter despite a record number of 3G base station shipments.

About the Report

The Dell’Oro Group Mobility Infrastructure Quarterly Report offers complete, in-depth coverage of the market with tables covering manufacturers’ revenue, average selling prices, transceiver or RF carrier shipments, and unit shipments for base station controllers, base transceiver stations, and mobile switching centers for GSM/GPRS/EDGE, CDMA, WCDMA and WiMAX.

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