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TMCNet:  Smartphone growth still strong, driven by emerging markets [ITP.net (United Arab Emirates)]

[August 31, 2014]

Smartphone growth still strong, driven by emerging markets [ITP.net (United Arab Emirates)]

(ITP.net (United Arab Emirates) Via Acquire Media NewsEdge) More than 1.25bn smartphones will be shipped worldwide in 2014, representing a 23.8% increase from the 1.01bn units shipped in 2013, according to the International Data Corporation's (IDC) Worldwide Quarterly Mobile Phone Tracker.


Total volumes are forecast to reach 1.8bn units in 2018, resulting in a 12.7% compound annual growth rate (CAGR) for the 2013-2018 forecast period.

Emerging markets have accounted for more than 50% of annual smartphone shipments since 2011, according to IDC, but up until 2014, mature markets have still delivered double-digit, year-on-year growth. In 2014, IDC expects mature markets will slow to just 4.9% growth, with emerging markets continuing to climb, at 32.4%, pushing the total market up 23.8%.

"The smartphone market, which has experienced runaway growth over the last several years, is starting to slow," said Ramon Llamas, research manager with IDC's Mobile Phone team.

"Mature markets have slowed considerably but still deliver strong revenues with average selling prices [ASP] over $400. Meanwhile, many emerging markets are still barrelling along, but with ASPs of less than $250... The key for vendors now is to maintain a presence in the higher-margin mature markets, while establishing a sustainable presence within the fast-growing emerging markets. To enable this strategy, operating system companies are partnering with OEMs to provide low-cost handsets." Continues on next page>> In 2014, IDC expects emerging market smartphone volume to grow to 920.8m units accounting for 73.5% of all volume shipped. The catalyst here continues to be Android devices, which are expected to account for 88.4% of this volume. IDC's outlook for emerging market smartphone volume is 1.4bn units by 2018, growing to 79.5% of worldwide volume.

"The support that Google's Android platform has received from over 150 handset manufacturers has allowed it to gain the share it has in emerging markets," said Ryan Reith, programme director with IDC's Worldwide Quarterly Mobile Phone Tracker.

"The lack of constraints around hardware and software specifications has helped bring to market many low-cost products, a lot of which could be considered borderline junk. With Google's recent announcement of Android One, they hope to change this by laying out a set of standards for manufacturers to follow." IDC also highlighted the shift towards large screen smartphones. The company expects phablets to grow from 14% of the market in 2014 to 32.2% of the market in 2018. With the expected entry of Apple into this market segment, and the pent-up demand for a larger screen iPhone, Apple has the ability to drive replacement cycles in mature markets despite the slower growth seen in recent quarters.

(c) 2014 ITP Business Publishing Ltd. All Rights Reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

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