Sony Ericsson admitted that they lost around £19.4 million in Q3 of 2008. They are the first handset vendor to admit to having taken a clobbering this year. It’s partly due to its reliance on Europe but more on a severe decrease in the Average Selling Price (ASP) for handsets. SE, however, predicted that its Walkman brand would help shore up sales but the C902 Cybershot camera-phone is the surprise hit model of the quarter. The company also is due to launch Playnow with Telenor in Sweden during Q4 2008 with a special edition of the  with Playnow built-in. It has also introduced three new Walkman phones including its first models with integrated Youtube support (W595, W902, G705).

Despite this terrible news, SE still managed to ship 25.7 million units in Q3 2008 and says its market share remains about flat at eight per cent. That will keep it in the number five slot unless Motorola does even worse. Sony Ericsson forecasts that the global handset market for 2008 will grow at a rate of around 10 per cent from more than 1.1 billion units in 2007. The catch is that a lot of these handsets are going to emerging markets.