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Posted on October 2nd, 2012, by

The development of modern technologies contributed to a considerable change of traditional telecommunication technologies. In this respect, the emergence of cell phones as a new type of telecommunication devices was a particularly remarkable trend of the late-20th century and the industry keeps progressing today. In actuality, cell phone industry has good prospect for growth, though, it should be said that, in recent years, the industry has undergone consistent changes and the growth of cell phone rates has slowed down substantially. In such a situation, it should be said that one of the major trend in the cell phone industry is the shift of production facilities from developed countries to developing ones, while the former still remain major developers of cell phone and headquarters of leading cell phone companies are still located in well-developed countries.

On  analyzing the history of the development of cell phone industry, it should be said that originally the development of cell phone industry started in developed countries, namely in the USA, Europe and Japan. In fact, the invention of cell phones was a considerable advancement in the development of telecommunication technologies. At the same time, the cell phone industry was traditionally a highly technological, knowledge-based industry. In such a situation, it is quite natural that the main cell phone manufacturers were and still are located in well-developed countries of the world.

Obviously, well-developed countries had scientific and technological potential not only for the invention of cell phones but also for the development of cell networks. In this respect, it is important to lay emphasis on numerous advantages of cell phones compared to conventional phones. One of the major advantages of cell phones is the mobility. What is meant here is the fact that customers can use cell phones freely without any restrictions as long as the network coverage allows the maintenance of connections of phone users.

At the dawn of cell phone industry, it was mainly large cities where cell phones were introduced. At this epoch, the target audience of cell phone manufacturers was mainly businessmen who needed the mobility provided by cell phones and who mainly stayed in the city limits.

In such a situation, the price of cell phones was high because of the exclusiveness of the product and its orientation on the premium segment of the market. However, the enlargement of cell networks stimulated the wider use of cell phones. In addition, the development of the network and the growth of cell phones Ēė sale rates lead not only¬† to a considerable growth of the number of cell phones but also a substantial decrease of its price.

In fact, the decrease of price was logical because the price should meet the buying power of users. At the same time, the growing demand stimulated the ongoing development of cell phone industry. In this respect, it should be said that the competition in the cell phone industry grow stronger along with the quality of products. The technology of production became more and more available and many companies attempted to enter the highly prospective. Nevertheless, the technological complexity of cell phone manufacturing led to the consistent advantage of several leading companies, which currently occupy the leading position in the international market. To put it more precisely, today, Nokia is the largest cell phone manufacturer which has about 40% of the global market, Samsung and Motorola have 14% respectively, Sony Ericsson 9%, and LG 7% (Kavoori & Arceneaux, 2006). In such a way, these companies control about 80% of the global market, while other, minor producers of cell phones have the rest.

Furthermore, the development of cell phone industry was accompanied by a considerable and fast growth of sale rates. However, cell phones’ sale rates could grow permanently without constant improvement of cell phones. In the course of time, they became more and more complex. At the present moment, the mainstream trend in the cell phones industry is the introduction¬† of innovations which make cell phones truly multifunctional devices. For instance, today, cell phones are used not only as conventional phones, but they can actually replace a PC and perform multiple functions, including not only business functions but also entertainment. The development of IT stimulated the wider use of cell phones as means of communication via Internet, while the access to Internet has enlarged the functionality of cell phones even more.

At the same time, the production of cell phones moved from developed countries, where headquarters of leading cell phones manufacturers are located, to developing countries. However, the latter are used as assembling facilities to decrease the costs of production and to make cell phones  more available to customers. On the other hand, facilities of cell phones manufacturers in developed countries are mainly responsible for the development of technological innovations and improvement of cell phones.

Moreover, the process of globalization contributes to the shift of production of cell phones in developing countries. For instance, the US-Singapore free trade agreement allowed Singapore to export cell phones to the US, since fiscal barriers were eliminated. In such a situation, the elimination of trade barriers leads to the growing production of cell phones in developing countries and their export worldwide, since the costs of production are lower in developing countries compared to developed ones.

Finally, it should be said that today cell phones manufacturers have to deal with new issues such as recycling of cell phones and their safety to human health. In this regard, the problem is that the impact of cell phones on humans is under-researched, though there is a risk of negative impact of cell phones on human health. As for recycling of cell phones, this is the problem in developed countries caused by increased environmental concerns of the society.

Thus, in conclusion, it should be said that the cell phone industry keeps progressing. The number of cell phone users constantly grows that encourages cell phone manufacturers to increase and diversify their production.

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