San Francisco Growth in smartphone shipments is expected to slow substantially this year, as shipments to China, the world’s largest market for the devices, increase by just 1 per cent from last year.
Worldwide, smartphone shipments are forecast to grow 10.4 per cent in 2015 to 1.44b units, according to the International Data Corporation, falling from 27.5 per cent growth in 2014. IDC announced a cut in its forecast, which was previously for a 11.3 per cent rise across the globe.
IDC forecasts a big drop in growth in China, which received almost a third of all new smartphone shipments in 2014, with an increase of only 1.2 per cent year-on-year in 2015, down from 19.7 per cent in 2014.
The widely followed forecasts were published a day after Tim Cook, Apple’s chief executive, insisted the iPhone maker was experiencing “strong growth” in China throughout July and August.
In a note to Jim Cramer, the host of TV show Mad Money, he said iPhone activations in China had actually accelerated in the past few weeks. The email about Apple’s largest growth market helped save the company nearly $80 billion (Dh294 billion) in its market value, after the stock started the week 10 per cent down following a ‘Black Monday’ for Chinese equities.
IDC does not break out an estimate for iPhone growth in China.
Ryan Reith, programme director at IDC, said domestic growth overall in smartphones in China was slowing “significantly”. China would remain the largest market for smartphone volumes for some time but its market share was expected to fall to 23.1 per cent in 2019, according to IDC.
“India has captured a lot of the attention that China previously received and it’s now the market with the most potential upside,” he said. “The interesting thing to watch will be the possibility of manufacturing moving from China and Vietnam over to India.”
IDC forecast Android would maintain more than 80 per cent of the global market as far out as 2019, as the markets with the biggest growth opportunity remain “extremely price sensitive”.
“This isn’t to suggest that Apple’s success with the iPhone won’t continue, and IDC believes its efforts to maintain significantly higher margins compared to its competitors are much more valuable than chasing share,” the IDC report said.
Larger smartphones — often dubbed “phablets” because they appear to be a cross between a phone and a tablet — are forecast to grow 84 per cent in 2015, compared with last year, after Apple delivered the larger iPhone 6+. These devices, with display screens from 5.5 to 6 inches, are forecast to make up more than 70 per cent of smartphone shipments by 2019.
— Financial Times
