Global shipments of cellphones ( excluding white brand models ) are forecasted to grow 12% to 1,33 billion units in 2010, including 235 million smartphones, after holding steady in 2009. The prediction was made by the Topology Research Institute (TIR), the largest private market research firm in Taiwan.

TRI says that emerging markets, especially China and India, will continue to be the major locomotive for the growth of handset shipments.

The penetration ratio of smartphones is forecasted to climb to 18% in 2010, up from 15% in 2009, a key factor in stabilizing the average cellphone selling prices. Entry-level smartphone models, which are expected to to generate higher margins and to have a bigger space for future growth, will attract more and more companies ( existing cellphone makers or otherwise ) to jump into the bandwagon, making these the most eye-catching models in the 2010 market.

TIR states that the Asia Pacifric region ( excluding Japan ) will report the fastest economic growth in 2010, and will thus become a major target for the marketing of lower-level cellphones. Cellphone penetration in China, for example, is expected to hit 64% in 2010, representing a total of 1,17 billion users. The growth rate of new subscribers is slowing down, but 3G handset replacement purchases in in southwestern Chinese cities, and strong demand fro rural farm villages for extra-low price models will spur the market.

In contrast to the weakening growth in China, India is in a stage of high-speed expansion. Its cellphone penetration rate is forecasted to reach 65,4% in 2010, for a total user base of 762 million. The number is expected to continue growing along with the competion of an increasing number of telecom construction projects in second and third tier cities.

New focus: Entry-level Smartphones.

The TIR notest that according to its research, the growth of smartphone shipments stand out in the overall cellphone market. About 235 million smartphones are expected to be shipped in 2010, up 20% over 2009.

TIR says that the average selling prices of smartphones, now about US$ 329, is three times that of of feature phones and 10 times that of basic phones. But entry-level smartphones which use an open operating system (OS) are priced between feature phones and high-end smartphone are expected to stimulate strong sales and further expand the smartphone market.

One interesting trend, TRI reports, is that more and more non-cellphone vendors, such as computer brands Acer and Dell, telecom carriers such as China Mobile, Vodafone and T-mobile, and even GPS device maker Garmin have been jumping into the smartphone industry. That should increase the volume of OEM/ODM demand and accelerate the transformation of Taiwan cellphone makers from suppliers of low-end handsets into smartphone manufacturers. This will improve their product mix by allowing them to target more precise consumer groups, it will also boost their profit margins and expand their customer bases.