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    Global Smartphone Shipments to Drop in 2018, Rise Again in 2019: IDC

    By
    Todd R. Weiss
    -
    May 31, 2018
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      For the second year in a row, fewer smartphones will be shipped by manufacturers, but by 2019, the market will again begin to grow, according to the latest research from IDC.

      About 1.462 billion smartphones will be shipped in 2018, which is down from 1.465 billion handsets that shipped in 2017, according to a May 30 IDC announcement based on the IDC Worldwide Quarterly Mobile Phone Tracker. But starting in 2019 and beyond, the global smartphone market is expected to grow roughly 3 percent annually, with worldwide shipments reaching 1.654 billion in 2022, according to the announcement. The global smartphone shipment rate declined by 0.3 percent in 2017 as the market retreated.

      The main reason for the global 2017 smartphone shipment decline was the China market, according to IDC, where the smartphone market declined by 4.9 percent year-over-year. 

      “Tough times are expected to continue in 2018 as IDC forecasts consumption in China to decline another 7.1 percent before flattening out in 2019,” the company stated. Meanwhile, gains in smartphone shipments are forecast for India, where volumes are expected to grow 14 percent in 2018 and 16 percent in 2019.

      Ryan Reith, one of three IDC analysts who compiled the latest report, told eWEEK that the 2017 global smartphone decline was a “pivotal moment in the industry” because it marked a significant change after years of shipment increases.

      A major reason for the 2017 shipment drop was the shipment declines in China, which due to its huge population is “almost a market in itself and has almost pulled down global growth due to its size,” said Reith.

      With the China market still working to recover, “India is the market that everyone is looking at now for growth, because smartphone penetration is low there,” he said.

      Ultimately, though, “there is a big difference between India and the China market five years ago,” Reith said, because China subsidized its phone market, making it more affordable for users to purchase their handsets. No such program exists in India, so smartphone sales there don’t get such a boost.
      For smartphone makers, however, due to market pressures, smartphones sold in India will continue to sell for half the price of smartphones sold in China, bringing handset makers less revenue, said Reith.

      “It means different players in terms of OEMs who are selling the phones,” he added. “It makes it hard for Apple to sell phones in India because of those lower prices. Even their cheapest offering, like the older iPhone 6s or so, sells for about $450, while the average smartphone price in India is $200 or less. That’s a big difference.”

      In its latest research, IDC also forecasts that the first commercially ready 5G smartphones will appear in the second half of 2019, with a ramp-up across most regions happening in 2020. IDC projects 5G smartphone volumes to account for roughly 7 percent of all smartphones in 2020, or 212 million in total. The share of 5G devices should grow to 18 percent of total volumes by 2022.

      The average selling price of a smartphone will reach $345, up 10.3 percent from the $313 in 2017, according to IDC’s research. Globally, the smartphone focus in 2018 will be on the ultra-high-end segment of the market, with devices featuring large AMOLED bezel-less displays, advanced camera functions, and increased speed and performance driving the market.

      Android’s share of total smartphones is expected to remain relatively stable at 85 percent of shipments worldwide, according to IDC, with Apple handset shipments expected to grow by 2.6 percent in 2018 to 221 million. IDC estimates that 98 percent of Android phones will ship with screens larger than 5 inches by 2022, with 36 percent being 6 inches or larger.

      One thing to watch starting in 2018 is that more mid-range and low-end smartphones will be gaining features such as bezel-less glass as the price of producing such features continues to drop, said IDC’s Reith. Supply chain suppliers are telling IDC that the trend is coming, he said. “There will be differences in glass quality and they won’t be as premium, but the feature will be there.”

      One other trend is becoming clear, said Reith—future smartphones won’t have as many big new features to gain but will instead differentiate themselves in the market with faster performance and more storage. “We’ve gotten the key main features now,” he said. “That’s likely the biggest advancements we’re going to see in the future.”

      Todd R. Weiss
      As a technology journalist covering enterprise IT for more than 15 years, I joined eWEEK.com in September 2014 as the site's senior writer covering all things mobile. I write about smartphones, tablets, laptops, assorted mobile gadgets and services,mobile carriers and much more. I formerly was a staff writer for Computerworld.com from 2000 to 2008 and previously wrote for daily newspapers in eastern Pennsylvania. I'm an avid traveler, motorcyclist, technology lover, cook, reader, tinkerer and mechanic. I drove a yellow taxicab in college and collect toy taxis and taxi business cards from around the world.

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