Camera phones give IT sector a lift

Demand for mobile phones with built-in digital cameras is set to boom, according to both analysts and manufacturers

The demand for mobile phones with built-in digital cameras is giving a boost to the IT manufacturing industry and could soon overtake the digital camera market.

A report issued earlier this month by research group Strategy Analytics claims that mobile phones with digital camera capabilities would prove extremely popular with consumers. Strategy Analytics estimated that 16 million camera phones will be sold in 2002, but expects demand to soar over the next five years.

"Camera phones will outsell digital cameras by 2004," said Strategy Analytics. The company predicts that in 2007 a total of 147 million camera phones will be sold worldwide, compared to only 95 million digital cameras.

Strategy Analytics believes that multimedia messaging will drive the interest in camera phones, as consumers use the camera on their phone to create images for their own messages.

Many PDA manufacturers are already producing digital camera plug-ins for their devices, but Strategy Analytics estimates that embedded-camera PDAs -- where the camera is integrated into the PDA -- will only make up six percent of total PDA sales in 2007.

Earlier this year Sony Ericsson announced its first camera phone. The P800 has an integrated digital camera and images can be viewed on its 208 by 320 pixel colour screen. Another Sony Ericsson phone, the T68i, supports a snap-on camera accessory called the CommuniCam.

The arrival of camera phones is benefiting the technology industry already.

Japanese manufacturer Sharp said on Wednesday that sales of the liquid-crystal displays (LCD) it makes for mobile phones with digital cameras have pushed its profits up by 40 percent, more than compensating for a decline in sales of other technologies.

A mobile phone with a built-in digital camera generally requires a decent LCD screen. Users expect to be able to evaluate their pictures as soon as they have been taken, allowing them to delete unwanted shots and make space in the phone's memory for other photos.

"Strong sales of liquid-crystal display televisions and mobile phones more than offset waning demand for chips, air conditioners and other white goods," Sharp's chief financial officer Hiroshi Saji said in a statement.

Sharp anticipates that its LCD unit will achieve a 40 percent rise in sales this financial year.

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