Thursday, January 20

Smartphone shipments to rebound in 2019

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Source: IDC

KUCHING: According to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, worldwide smartphone shipments are expected to decline by three per cent in 2018 before returning to low single-digit growth in 2019 and through 2022.

It stated: “While the on-going US-China trade war has the industry on edge, IDC still believes that continued developments from emerging markets, mixed with potential around 5G and new product form factors, will bring the smartphone market back to positive growth.”

It noted that smartphone shipments are expected to drop to 1.42 billion units in 2018, down from 1.47 billion in 2017. However, IDC expected year-over-year (y-o-y) shipment growth of 2.6 per cent in 2019.

“Over the long-term, smartphone shipments are forecast to reach 1.57 billion units in 2022,” it added.

From a geographic perspective, it pointed out that the China market, which represented 30 per cent of total smartphone shipments in 2017, is finally showing signs of recovery.

“While the world’s largest market is still forecast to be down 8.8 per cent in 2018 (worse than the 2017 downturn), IDC anticipates a flat 2019, then back to positive territory through 2022,” it explained.

The slow revival of China was one of the reasons for low growth in in the third quarter of 2018 (3Q18) and this slowdown is expected persist into 1Q19 as the market is expected to drop by three per cent in 4Q18, IDC said.

“Furthermore, the recently lifted US ban on ZTE had an impact on shipments in 3Q18 and created a sizable gap that is yet to be filled heading into 2019.

“With many of the large global companies focusing on high-end product launches, hoping to draw in consumers looking to upgrade based on specifications and premium devices, we can expect head-to-head competition within this segment during the holiday quarter and into 2019 to be exceptionally high,” said Sangeetika Srivastava, senior research analyst with IDC’s Worldwide Mobile Device Trackers.

IDC believed that larger-screen smartphones (5.5 inches and above) would lead the charge with volumes of 947.1 million in 2018, accounting for 66.7 per cent of all smartphones, up from 623.3 million units and 42.5 per cent share in 2017. By 2022, shipments of these larger-screen smartphones will move up to 1.38 billion units or 87.7 per cent of overall shipment volume.

“What we consider a so-called normal size smartphone has shifted dramatically in a few short years and while we are stretching the limits with bezel-less devices, the next big switch to flexible screens will test our imaginations even further,” said Melissa Chau, associate research director with IDC’s Worldwide Mobile Device Trackers.

“While this category of device is still nascent and won’t see major adoption in the year ahead, it’s exciting to see changes to the standard monoblock we are all so used to carrying.”

Meanwhile, on the smartphone platforms’ global market share of, IDC noted that Android’s smartphone share would remain stable at 85 per cent throughout the forecast. Volumes are expected to grow at a five-year compound annual growth rate (CAGR) of 1.7 per cent with shipments approaching 1.36 billion in 2022.

Android is still the choice of the masses with no shift expected. Android average selling prices (ASPs) are estimated to grow by 9.6 per cent in 2018 to US$258, up from US$235 in 2017.

IDC expected this upward trajectory to continue through the forecast, but at a softened rate from 2019 and beyond. Not only are market players pushing upgraded specs and materials to offset decreasing replacement rates, but they are also serving the evolving consumer needs for better performance. As for iOS smartphones, it forecast a drop by 2.5 per cent in 2018 to 210.4 million.

“The launch of expensive and bigger screen iOS smartphones in 3Q18 helped Apple to raise its ASP, simultaneously making it somewhat difficult to increase shipments in the current market slump. IDC is forecasting iPhone shipments to grow at a five-year CAGR of 0.1 per cent, reaching volumes of 217.3 million in 2022.”