On the heels of its recent prediction that mobile device volumes would be down in 2009 compared to 2008, the world’s largest maker of mobile devices today further lowered its outlook for the current quarter and all of next year.

 

Officials at Finland-based Nokia now say their previous estimate of about 330 million units in the fourth quarter of 2008 – itself a lowered projection – now appears unattainable, as is an earlier annual estimate of a 1.24 billion total units. The mobile device leader still plans to see about 38 percent of the overall market, as it did in the third quarter.

 

Overall, the company sees mobile device volumes falling 5 percent in 2009, compared to 2008.

 

“The mobile device market slowdown has continued more rapidly than previously expected since Nokia (News - Alert) issued an update (about two weeks ago),” the company said. “The industry continues to be impacted by the effects of a global consumer pull-back in spending, currency volatility, and decreased availability of credit.”

 

Specifically, Nokia said the slowdown is apparent in varying degrees across all markets, while the most recent incremental impact in the emerging markets has been more pronounced than in other markets.

 

“As a result, and while noting the lack of visibility due to the factors cited above, Nokia is revising its fourth quarter 2008 outlook,” company officials say.

 

Like many companies, in the IT and telecom industries and beyond, Nokia has had a tough couple of months. In one recent announcement, the company said it would cut nearly 600 employees.

 

Nokia’s announcement comes as an IT market research firm reports an 8.2 percent third quarter year-over-year increase for mobile handsets.

 

Though some mobile device makers fared better than others, officials at ABI Research say, the handsets’ value as more than fashion accessories has fueled market growth.

 

According to the firm’s research director, Kevin Burden, Nokia stumbled somewhat and saw its market share shrink to about 38 percent, while Motorola (News - Alert) and LG also were net losers, with market shares of about 8 and 7 percent, respectively.

“Winners include Samsung (16.6 percent), Apple (News - Alert) (2.2 percent), and RIM (2.0 percent),” Burden said. “Smartphones are truly capturing the imagination of the buying public which is benefitting vendors with highly desirable smartphones.”

 

Here’s how ABI breaks down vendor market share for the third quarter in its report, titled “Mobile Devices Market Sizing and Share”:

 

 

Officials at the Finnish handset maker say slower consumer spending is making its mark.

 

“Nokia also expects that operator and retail distribution channels will go through a period of destocking, resulting in lower sales volumes by manufacturers (sell-in) than purchase volumes by consumers (sell-through) for the industry in the first half of 2009,” company officials say.

 

The company also said it has adjusted its Internet services market focus to the areas of music, maps, media, messaging and gaming.

 

Nokia President and CEO Olli-Pekka Kallasvuo (News - Alert) said that 2009 will be challenging for the industry, but said the company has a strong, enviable base to build on and believes it will strengthen its position.

 

“Building on our operational flexibility, Nokia is acting to reduce costs appropriately in the current slowing environment,” Kallasvuo said. “At the same time, we remain fully committed to making the investments to build the future of our exciting industry and Nokia’s continued competitiveness.”