Many mobile users are upgrading to use new technologies

Some 516 million handsets were shipped last year, up from 429 million in 2002 and beating the previous record of 435 million in 2000.

"We are not seeing the 40% growth rates of the late 1990s but sales are still quite high," the firm said.

Sales are expected to grow by 13% in 2004, as companies find new markets and existing users upgrade their phones.

New technologies

"The market is beginning to boom... Mobile phones aren't going to lead the world out of recession but sales are much healthier than a year ago," said Neil Mawston, joint author of the report.

Sales were particularly robust in the last quarter of last year, up 17% on the same period in 2002, the study said.

Improving market conditions and new technology - such as camera phones - had helped boost sales, it continued.

Global market leader Nokia shipped almost 180 million handsets in 2003, up from 150.6 million in the previous year.

Motorola saw sales rise from 70 million to 75 million over the same period while Samsung's shipments grew from roughly 42 million to 55 million.

Firms will be looking to expand in Eastern Europe, Latin and Central America and Asia, the study said.