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The Wall Street Journal (subscription required) has an interesting article pointing out that the latest cellphones are coming complete with better prices and similar features when compared to the iPod nano. Sure, Apple has sold more than 60 million iPods globally, but there are over two billion cellphone users in the world. And analysts explain that close to one billion cellphones will be shipped in 2006 alone.

For the iPod being as mobile as it is, one consumer says, "I carry my
phone with me wherever I go…But I don’t always have my iPod with me."
And music cellphone sales are already showing signs of strong
performance around the world. Sony Ericsson has sold 15.5 million
Walkman music phones in just 14 months, and Motorola claims sales of 15
million "high-quality music phones" in the past year. But now for the
real clincher: Nokia expects sales of music phones to be 80 million in
2006 alone, making it the world’s largest manufacturer of digital
music-players (sorry Apple).

Obviously not all consumers who end up with a music phone use it to play songs. But Sony Ericsson says half of the owners of Walkman phones do listen to music on their phones. And Motorola claims its research shows that over half of its music phone customers us their phones to listen to music. This is especially interesting considering that, just a few months ago, a study published showed that consumers use phones only as phones. But perhaps phone features have improved enough since then.

Industry executives are, of course, excited by all of this. Suzzane Cross, head of product marketing for Sony Ericsson in North America says, "The growth rate of music phones will be much faster than iPod mainly
because consumers will always need a phone, and it only takes them a
short period of time to explore the features."

Apple’s retaliation? All we have so far are rumors of Apple ordering 12 million combination music player / phone iPods from a manufacturer in Taiwan. Check out the chart below, which compares the iPod nano to music phones on the market:

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