On Friday at CeBIT, Sony launched its first Internet-enabled Wireless Application Protocol (WAP) mobile phone, saying it would now target the replacement handset market rather than first-time buyers.
"We think that 50 percent of total handset shipments will soon be for replacement phones," said Sony's European sales director of marketing digital telecommunications, Mike van der Wallen. "We forecast that the replacement market could total 90 million units in Europe and 150 million globally," he said.
The CMD-Z5, which features Microsoft's Mobile Explorer dual-browser, is Sony's first foray into the WAP market, following the lead of major mobile phone players Nokia, Motorola and Ericsson.
With the arrival of broadband networks, the company said that it would utilise its games, music and image content to offer consumers an incentive to buy its products.
"Going forward into third-generation... what Sony can add is compelling content," said van der Wallen. "The Sony world of IT, hi-fi and digital imaging will enable us to drive development of content to boost demand." He added that with the arrival of GPRS, the company would concentrate on the delivery of music to its phones.
As next-generation wireless technology is becoming established, companies are now looking to provide compelling content to differentiate themselves in the eyes of consumers. Tim Sheedy, senior analyst at IDC, agrees that with the technical infrastructure now in place, "content will be crucial" for success in the wireless world.
However, with mobile network operators increasingly signing a range of content partnership deals, companies that have to rely on their delivery networks should be wary of stepping on any toes.
Van der Wallen said that although Sony would "maybe look at proprietary content delivery systems", it would have to be careful to avoid any "conflict of interest with mobile networks".
The 82g CMD-Z5, due to ship in June, is aimed at the "young and trendy mobile professional", and is the smallest WAP phone on the market.
Van der Wallen admitted that Sony, a minor handset player, had to focus on a market niche, but said 2000 would see a dramatic upswing for Sony in handsets.
"By focusing on the replacement market, we are excluding the lower-end models, but we feel it is an area where we can add value," he said.
Reuters contributed to this report.
For full coverage, see ZDNet UK's CeBIT 2000 special.