Camera phone sales will exceed 1 billion units worldwide for the first time in 2011, according to Strategy Analytics, which opens up many opportunities for marketers and retailers.

The research firm’s report found that the fastest-growing segment will be the high-end camera phone market—smartphones with sensors of eight megapixels and above. Strategy Analytics forecasts worldwide camera phone sales to increase 21 percent, from 918 million units this year to 1.114 billion units in 2011.

“We caution that the opportunities for advertisers and marketers to monetize camera phones are relatively limited in the short-term, due to low consumer awareness and an immature supply chain,” said Neil Mawston, Milton Keynes, Britain-based director at Strategy Analytics.

“But in the longer time frame of the next two-to-10 years, there will be an established global user-base of hundreds of millions of high-resolution 3G camera phones, giving advertisers and marketers such as Google an opportunity to experiment with potentially high-value services like localized advertising through augmented search or bar code price-comparisons while out shopping for clothes,” he said.

“Essentially, the higher the quality of the camera phone, the greater the opportunities for advertisers and marketers to deliver more advanced services.”

Strategy Analytics is an independent research and consulting firm. The company is headquartered in Boston, MA, with offices in Britain, France, Germany, Japan, South Korea and China.

Camera phone surge
Strategy Analytics reported that this year will be the first time annual volumes of camera phones will surpass the 1-billion mark.

Approximately 4.2 billion camera phones have been sold worldwide since 2000 and they are one of the most successful mobile products ever developed.

Strategy Analytics forecasts that high-end camera phones with sensors of eight megapixels and above will grow a robust 240 percent worldwide this year.

Mr. Mawston said that smartphone manufacturers such as Nokia and HTC are increasingly loading their flagship models with more megapixels to deliver improved imaging quality for premium services such as augmented reality.

“The first generation of camera phones in 2000 to 2005 delivered relatively basic camera phones for low-quality still images,” Mr. Mawston said.

“The second generation of camera phones in 2005 to 2010 upgraded to mid-quality still images and low-quality video-recording,” he said.

“The third generation of camera phones is emerging in 2010 to 2015 and will deliver high-quality images and mid-quality video-recording for more advanced services such as HD-video uploads, 3D-photo uploads, augmented reality, bar codes for shopping and so forth.”

Final Take
Esquire’s augmented reality