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Agencies
Global shipments of smartphones are expected to grow 1.4 percent in 2018 compared to the year before, with numbers likely to rise at a faster clip from 2019 onwards once the real-world 5G network is introduced, a report by an industry consulting firm showed Sunday.
According to Strategy Analytics, total smartphone shipments are expected to reach a little over 1.49 billion units, up from 1.47 billion in 2017. The poor showing is a repeat of numbers for 2016 and 2017 when annual growth was tallied at 1.8 percent and 1.2 percent, respectively.
This is in stark contrast to double digit growth posted in the years after 2007, when Apple Inc. first launched its revolutionary iPhone.
The global research and consulting firm said the drop in shipments and sales is mainly due to overall improvements in the capabilities of the latest handsets and a longer replacement cycle for recent phones. Greater smartphone penetration across the globe and higher unit cost also may be having effect on consumer demand, it said.
SA, however, predicted that, starting in 2019, there may be an upshift in demand for smartphones as the much quicker and more stable 5G networks come online, requiring new mobile devices to fully take advantage of the new developments.
It said that in 2019, the worldwide market for smartphones may expand 3.5 percent on-year followed by 4.4 percent growth in 2020 and 4.9 percent in 2021. By 2023, it said growth will be around 4.1 percent, with companies churning out 1.86 billion phones per year.
South Korea is expected to introduce 5G in March next year, and bidding for frequencies is currently under way.
Meanwhile, market watchers say that moves by leading vendors like Samsung Electronics Co. and Apple to launch foldable phones in the near future could stimulate growth.
Samsung has hinted that its foldable smartphone may be released in first half of next year. Apple could follow suit in 2020.
Nearly 384 million smartphones were sold in the first quarter of 2018, representing 84 percent of total mobile phones sold.
Continued weakness in Greater China's mobile phone market also limited growth potential for the top global brands, including Chinese brands such as OPPO and Vivo, with over 70% of their sales coming from Greater China.
Samsung's midtier smartphones faced continued competition from Chinese brands, which led to unit sales contraction year on year.
This is despite the earlier launch of its flagship Galaxy S9/S9+ compared to the S8/S8+ in 2017, and despite the Note 8 having a positive impact on Samsung sales in the first quarter of 2018.
Samsung's smartphone growth rate will remain under pressure through 2018, with Chinese brand's growing dominance and expansion into Europe and Latin America markets.
Samsung is challenged to raise the ASP of its smartphones, while facing increasing competition from Chinese brands that are taking more market share.
The delayed sales boost for Apple from last quarter materialized. Apple's smartphone unit sales returned to growth in the first quarter of 2018, with an increase of 4% year on year.
Huawei's refreshed smartphone portfolio helped strengthen its No. 3 global smartphone vendor position.
