A further 3.5 million were embedded modems, built into the computers. According to ABI Research principal analyst Philip Solis: “After years of slow growth, the embedded cellular modem market is starting to show signs of life, increasing volumes and exceeding expectations. ABI Research expects that, building on a good showing of 3.5 million units in 2008, shipments of embedded modems will more than double in 2009.”
Qualcomm and Ericsson have been targeting the embedded modem market directly, positioning their products very competitively against each other. Operators, especially in Western Europe, are subsidizing USB modems and offering premium data plans that include ‘free’ netbooks or laptops equipped with embedded modems.
Solis warns that despite the positive picture for embedded modems, the global recession will inevitably have an impact on the market. “In light of the prevailing economic conditions and the resulting slowdown in laptop shipments, ABI Research has lowered its overall forecasts for the cellular modem market for 2009. However, shipment rates will continue to grow, albeit at a slower place, because this is an underpenetrated market and because of subsidies and other incentives offered by mobile operators.”