Gartner's analysts raise their prediction for global sales of mobile phones, and now expect to see 16% growth this year. And sales of handsets will continue to grow – albeit at a slower pace – beyond that, with over 1 billion expected to ship in 2009.

If correct, this year’s predicted increase would represent a 16% rise on the 2004 figure. That is far higher growth than many forecasters – including Gartner – had been expecting previously.

Although the strong growth is generally good for suppliers of GaAs-based RF components and LEDs that are based on compound semiconductor technology, the price of phones is set to continue falling, putting pressure on average selling prices of individual components and modules.

While emerging markets such as Brazil and India are seeing a rapid uptake in mobile services, the mature markets are continuing to grow, believes Gartner.

It reckons that of the 850 million phones that it expects to see shipped in 2006, over 100 million will be handsets offering third-generation services.

Despite the overall growth trend, the industry’s big brand names will have to work hard to stay competitive.