Alcatel, Philips and Sagem Ideal Takeover Targets - Report"

According to a Strategy Analytics report Alcatel, Philips and Sagem handsets are sold by half of all operators in Western Europe, yet they account for only 13% of shipments in that region. This combination of strong distribution and weak market share makes them attractive partners for vendors like Siemens, who need additional scale, or vendors, such as NEC, Samsung, LG and Toshiba, who require affiliation with priority operators.

"Strong distribution relationships with operators is the critical success factor in the emerging Western European smart device market," notes Neil Mawston, Industry Analyst with the Strategy Analytics Global Wireless Practice. David Kerr, VP, added, "Asian vendors who largely missed the 2G GSM market are aggressively targeting W. Europe for next generation devices, but most lack operator relationships and effective distribution channels in volume markets. Acquisition or merger activity between established, albeit niche, slim profit profile, vendors such as Alcatel, Philips and Sagem, and innovative design driven Asian vendors, is a strong possibility in the next 12-18 months."

The report also noted that Telefonica has the greatest device diversity, while Max Mobil of Austria has the most limited portfolio. High-end and premium devices are being heralded as the next battleground and panacea for the entire industry's profit problems, but too many vendors will chase too few customers in 2002 and 2003 and after-sales support is a key challenge for smart devices targeting the Enterprise space.'"

Posted to the site on 10th May 2002