Mobile phone shipments in Japan slide 5% in January-June

TOKYO, Aug. 18 Kyodo - Japan's domestic shipments of mobile phones in the first six months of this year slumped 5.2 percent from a year earlier to 24,923,000 units, the second consecutive decline for the reporting period, said the Japan Electronics and Information Technology Industries Association on Monday.

Shipments for all of 2008 will likely fall from the previous year because phone users increasingly are holding on to their old handsets for a longer period,industry observers said.

The rate of decline for the six months widened from 0.7 percent in the sameperiod last year.

The statistics do not include phones for personal handy-phone system service,or PHS, provided by Willcom Inc.

The Japanese cellphone market is dominated by domestic manufacturers competing fiercely with one another by releasing ever higher-end phones. Because of this, some companies, unable to make up the increase in product development costs,have fallen into the red.

If the market continues to shrink, industry consolidation might set in throughcorporate mergers or acquisitions, according to industry watchers.

The market is almost saturated, with the number of subscriptions exceeding 100million in a country with a population of just under 130 million.

In June, however, domestic shipments turned up for the first time in five months, rising 2.1 percent from a year earlier to 5,085,000 units, thanks to the popularity of models that enable users to watch ''one-segment'' terrestrialdigital broadcasting, the association said.

People owning one-segment phones climbed to 73.5 percent of total cellphoneusers, exceeding 70 percent for the first time.

Domestic shipments of PHS phones, in contrast, jumped 24.7 percent in theJanuary-June period to 1,074,000 units, according to the association.

The sole provider of PHS services, Willcom, has recently been aggressively marketing handsets used primarily for voice communication