Shares in mobile phone makers including Nokia, Samsung Electronics and LG Electronics slipped yesterday on worries about their ability to compete with Apple's new iPhone.

But handset component makers such as Taiwan's Catcher Technology, as well as some telecom operators such as Japan's Softbank, gained on hopes the iPhone would replicate the success of Apple's iPod MP3 player.

Flash memory chip makers like Japan's Toshiba and South Korea's Hynix Semiconductor may end up benefiting should the iPhone capture the hearts of consumers when it goes on sale in the United States in June.

"For the handset makers, those who are seen to be competing handset makers look vulnerable. Most concerning would be the high-end guys," said Malcolm Wood, regional strategist for Morgan Stanley in Hong Kong. "But those companies in the supply chain for the iPhone will be protected."

Apple is introducing its mobile phone as global handset makers are already under intense pressure, with Motorola's profit warning last week signalling a tough year ahead. Shares in Nokia, the world's top handset maker, fell 2.2 per cent to €14.63, while Sweden's Ericsson was down 1.4 per cent.

"It's a short-term sentiment impact. It's a much-hyped story. Apple's a great marketing machine, but from the sheer volumes, it's not going to make a huge difference," said a trader in London."The question is how competitive Apple's products will be. Its competitors will have six months to think what to do. I don't think Apple's phone will be launched in a vacuum," said Evli bank analyst Ilkka Rauvola in Helsinki.

But some analysts also warned against over-reacting.

"Apple may be able to grab around 1 per cent of the handset market share with this phone, but they face much more competition compared to the iPod market," said Credit Suisse analyst Kevin Chang in Taipei. Apple chief Steve Jobs said he expected the company to sell 10 million iPhones by the end of 2008, a fraction of the one billion handsets sold globally per year.