MWC 2009 Feedback
COMMENT
Will the real Apple please stand up...
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Demand remains weak. We retain our view that handset fundamentals
remain weak entering 2009 and our expectation is for a volume decline of
8%/12% on a sell-through/in basis given inventory de-stocking that may
continue through 1H09. For infrastructure, we believe trends are mixed with
the near term holding up, but with capex cuts at carriers continuing, we
believe infrastructure revenues will decline 12% this year.
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Increasing smartphone competition. Of the 66 devices launched this year,
20 of them are smartphones highlighting increasing competition. In addition,
new entrants (Acer, Garmin, Huawei and possible Dell) or resurrected
competitors (Palm) could add to competitive pressures.
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Software & services…me too Apps stores, Android gaining traction…
Following in the footsteps of Apple, we have seen Nokia, China Mobile,
SEMC, Samsung and Microsoft announce various Apps stores. However
whether these are successful remains to be seen. We believe that Android is
becoming a force, gaining traction with device vendors (Motorola, HTC,
Samsung, LG, SEMC, Acer, Huawei) and carriers (Vodafone, T-Mobile).
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Lowering Nokia estimates; retain Neutral on Nokia, Underperform on
Ericsson and Outperform on Alcatel-Lucent. For Nokia, we lower our
2009 EPS by 12% to