Sony Ericsson signals cellphone business is still robust

Handset maker Sony Ericsson beat analysts' estimates for the fourth quarter of 2007 and said that the company is gaining market share. In a surprising development, the company said, "The average sales price (ASP) of its mobile phones, a key indicator for profitability, rose to 123 euros from 120 euros in the third quarter," according to Reuters.

The company's share of the global handset market is now close to 10%. Units shipped in the quarter reached 30.8 million, an 18% increase from a year earlier.

The news may be good for Motorola (NYSE: MOT) and Nokia (NYSE: NOK). Even if the economy is slowing, consumers may be willing to spend $200 for a new phone. Increasing business in regions like China and India is not driving down "price per handset." It may be that the emergence of more expensive "smartphones" is helping keep average prices high.

As 3G networks continue to be built out, consumers may find it necessary to upgrade their handsets to take advantage of higher connection speeds.

It is an early indication, but the cellphone industry may be bucking the trend of an economic slowdown.

Douglas A. McIntyre is an editor at 247wallst.com.