In a global mobile phone market of almost three billion and growing, there are increasing opportunities for niche players where gaining only a 1% share could prove profitable. Despite few statistics, analysts agree the handset market is fragmenting, as consumers demand more robust devices or ones suited to particular work or lifestyles.

Rugged and enterprise phones, easy-to-use and big-button devices and those designed specifically for older or younger users are finding a place in a market where competition from larger manufacturers is limited, focusing as they do mainly on high-end smart phones and mass-market consumer devices.

One growing niche market is for tough or rugged phones designed for use in inhospitable surroundings. According to research and consultancy firm Strategy Analytics, around 0.9 million rugged devices were sold in America in 2007 with sales in Europe not far behind.

Although some include smart phone features, their main function is to withstand the roughest treatment. The best on the market conform to ingress protection rating IP54 (military standard) for water and dust resistance, and many major manufacturers now have at least one tough phone.

life expectancy," says Hesham El Hamahmy, senior director, business development at Spirent Communications. "Demand for rugged phones is driven mostly by operators who can target specific users especially those who cannot afford to recycle phones often."

The IP54-compliant Samsung Solid phone includes a camera, torch, radio, SOS function, and Bluetooth connectivity; Nokia's 5140i features a torch, compass and thermometer. Siemens and Sony Ericsson also make water- and dust-resistant phones and Motorola's rugged MC75 3G, camera and GPS enterprise device based on the Windows Mobile 6.0 operating system is launching soon.

According to rugged phone manufacturer Sonim, the global compound annual growth rate for this sector will be 11.5% between 2005 and 2011 and at 3% in Europe, where a total of 246,000 phones will be shipped in 2011. "People want simple, easy-to-use phones which won't break, do the basics and are shock- and waterproof. These are no nonsense phones for people who work or play in rough, tough, extreme environments," says Sonim's CEO Bob Plaschke. The company recently collaborated with JCB to make a phone that exploits the power of the JCB brand to support its rugged credentials. It comes with a no-questions-asked, three-year guarantee. Other co-branded rugged phones could increase the addressable market by appealing to fashion- or lifestyle-conscious users.

Also increasing in popularity is the enterprise sector. Devised for employees, the operating system and back-end connectivity on enterprise phones can be controlled, locking them into corporate applications and barring users from certain functions. "We have seen a requirement for niche phones enabling people to do their jobs and combining the various features of different mobile devices into one multi-function unit," says Andy McBain, senior product manager at Motorola.

Also expected to grow is the market aimed at those unable to see small screens, or navigate their way around smaller keypads, especially as the population ages and the 'grey pound' becomes more attractive and powerful. However, Strategy Analytics estimates overall volumes for such phones were less than 1% of total US handset sales in 2006.

Few vendors directly target pensioners, but most operators have a range of basic, easy-to-use and low-cost phones suitable for this largely untapped sector. The intuitive iPhone man/machine interface and big screen make this an interesting device for older people without denting its appeal to youngsters.

However, while the grey pound is being chased, there are still ethical, data-security, and privacy concerns about marketing phones to children in the EU; concerns that led Disney to abort its European plans a couple of years ago. Despite the appeal of fun-shaped mobiles, their success is limited to less than 1% market share. Like those for older people, easy-to-use talk/text phones include a panic or SOS button. Many have buttons connecting directly to individuals, include GPS and phone functions may be controlled remotely.

For those needing a cheap back-up, perhaps when travelling, disposable talk and text phones are available but are thin on features and often without screens. Hop-on recently introduced a €12.50, GSM disposable phone to European and Middle Eastern markets.

Available from airport vending machines or retailers, disposables have not succeeded and are unlikely to do so in these days of environmental awareness; functional, cheap phones; falling international roaming tariffs; and widely available SIM cards. Most travellers want their own devices complete with address books and other features. Besides, says Ken Dulaney, vice-president of mobile computing at technology consultancy Gartner, throwaways make no sense since all phones are ultimately disposable and many are free with contracts. "People would rather go with contract phones giving them more features than disposables, which have no value."

Pete Nuthall, analyst at Forrester Research believes manufacturers need a diverse range and balanced portfolio to meet demand. "Niche phones will continue to be developed but won't be mass-market devices, yet there is a significant proportion of consumers who only want talk/text phones."