2009: When your phone becomes a Swiss army knife

It seems the world still can't get enough of new mobile handsets.

According to research from analyst house ARC Group, mobile makers will be able to enjoy a growing market for at least the next five years, with posh smart phones being a particular favourite with phone buyers.

ARC Group predicts the market will grow by 16 per cent and consumers will snap up 561 million mobiles this year - compared with 482.5 million in 2003 but the growth rate will start to tail off to reach 2.6 per cent in 2009, when 767 million handsets will be sold.

The growth will come from both consumers hungry for the latest models updating their old phones in mature markets such as Europe as well as buyers in countries including China and Brazil getting mobiles for the first time.

ARC Group predicts new data technologies will increasingly start to emerge on phones - GPRS, EDGE and 3G could well play a part - and helping to turn WAP into more of a popular mobile feature than a curiosity.

3G adoption, however, will get off to a slow start. The research foresees 3G handset sales eventually starting to pick up in 2006 and to become a third of all mobiles by 2009.

The future's brighter for smart phones, however. The analysts reckon that high-end smart phones will sell 14.7 million units in 2004 with low-end phones slated to sell 12.9 million. Higher end models will become the favourite son of the smart phone world though - raising market share from 53 per cent of smart phones this year to 65.5 per cent in 2009, although high prices on kit will keep the market as a whole small for a while to come.

However, despite cost barriers, new tech will make its way into the smart phones of the future - Bluetooth particularly will grow, from two million units last year to over six million in 2004.

WLAN smart phones will be more of a slow burner - growing from 1.27 million units in 2005 to 18.75 in 2009, according to Dr Malik Saadi, senior analyst with the ARC Group.

Nokia - the phone manufacturer with the largest share of the smart phone market - has witnessed a bit of a lukewarm reception for some new technologies, however.

Niklas Savander, Nokia's senior VP of enterprise solutions, said that CIOs were more keen on WLAN and GPRS than on 3G. "3G has yet to meet the needs of a CIO of a company," he said.