Market factors indicate stronger growth for multi-SIM handsets

CAMBRIDGE, USA: Multi-SIM handsets are expected to become a 100 million volume market by the end of 2010, driven primarily by low-income, price-sensitive markets, according to a new report from Pyramid Research. Market Factors Indicate Stronger Growth for Multi-SIM Handsets details the multi-SIM handset segment, why it is important, and highlights key developments.

The 12-page report includes an analysis of global subscriptions and SIMs, estimating the total multi-SIM ownership and breaking out the main reasons for users to have more than one SIM. The key driver of multi-SIM ownership, namely cost reduction, is explored before the developments on the vendor side are discussed, in particular at how the low-cost vendors have managed to dominate the multi-SIM segment.

It also highlights recent innovations and market entrants. This section also provides our estimate of multi-SIM handset sales. We then analyze operator views, including several examples of operators that are using multi-SIM handsets to gain market share.

Multi-SIM handset adoption is increasing and has reached a size large enough to attract global brands, notes Jan ten Sythoff, analyst at large at Pyramid Research.

"The niche was developed by low-cost Chinese and Indian vendors, which still dominate the market; now, more than 1.2 billion users have more than one SIM, with the majority in emerging markets, driven by cost-reduction opportunities," he says. Multi-SIM handset shipment volumes have increased rapidly and are expected to become a 100 million volume market in 2010.

Low-income, price-sensitive markets that are competitive and predominantly prepaid tend to result in pricing strategies that foster multi-SIM ownership. "The pricing strategies of operators trying to increase market share result in opportunities for price-sensitive users to optimize their costs by using different networks," he explains.

Operator interest in multi-SIM handsets is still lukewarm. "CDMA operators have been the most accepting of multi-SIM handsets in order to mitigate the benefits of GSM technology's dominance," Sythoff says.