Dubai: AI power is lighting up UAE’s smartphone sales, with the local gadget market currently recording its best first quarter performance since 2019, according to sources.
Leading the charge is the just launched Samsung Galaxy S24 flagship model, which comes with some of the first-generation AI-enabled features available on mobile handsets. Whether that’s helping out with the pictures or providing translation in multiple languages.
Based on market trends, this demand surge should last all through March and then the upcoming Eid related sales boost early April. Also arriving in the market at the earliest would be other AI-ready models available from other brands such as Honor and Nothing, including one handset that will feature a widget allowing an instant connection to Chat GPT features.
As for retailers, the best part is that prices of AI-powered smartphones are holding up. “Samsung’s decision to retain the price level on the S24 Galaxy range even with the heavy AI features is turning out to be a winning one,” said Rajat Asthana, Chief Operating Officer at Eros Group, and one of the big retailers for Samsung. “The S24 is emerging as a perfect all-round package, with a much improved hardware along with all that AI.” (Prices start at Dh3,199. Only one mode, the S24 Ultra 1T has had a price rise compared to a year ago, and is now at Dh6,599.)
We are now seeing improved availability of the S24 in the last few days, with more stocks being made available. This is very good for us as demand remains strong and we can expect a good Ramadan and Eid sales.
The last big 'moment' for smartphones was when 5G enabled ones became available, first as pricey top-of-the-line models and then to more affordable options. That started to come through from 2019 onwards.
Full-scale revival in UAE electronics market
The S24 launch – which was brought forward from Samsung’s usual March releases – is another move that has paid off, especially in the UAE, Saudi and other Gulf markets. The last three months of 2023 was quite slow for the electronics marketplace, sources add, and in the case of smartphones, it was even more so.
Even the more optimistic weren’t sure about prospects in the first quarter of this year too. And then the S24 happened. “It’s revived the mood for the entire smartphone market in the UAE and Gulf, and it’s all down to the AI features and the decision to keep prices constant,” said Saleem Javed, Managing Director of TouchTel, a Dubai-based tech wholesaler. “Demand is such that there is a 5 per cent or so additional premium for the models on overseas orders. I don’t think the market has seen anything like this for some time."
Demand is such that there is a 5 per cent or so additional premium for the models on overseas orders. I don’t think the market has seen anything like this for some time.
Lasting demand
According to online retailers, they are seeing clear patterns of demand, and which will continue through March and then during Eid and post-Eid phases too. “The ‘AI phones’ was among the most searched category in recent days,” said a senior official at an online marketplace. “Based on what we are seeing, buyers are not waiting for price cuts or heavy price offers. I don’t know whether people are switching from another brand, but Samsung S24 is picking up some heavy demand”
Other retailers say that a lot of potential buyers who wanted to upgrade in the final weeks of 2023 decided to wait. Those buyers too seem to be entering the market.
The Galaxy Z Flip 5 was the other device that fancied more than a few glances from Apple users."
- Ashish Panjabi, Chief Commercial Officer at Jacky's Electronics
S24 has done well and has been the first slab phone for a while that has had many Apple users curious about switching to Samsung.
Will other brands catch up?
Going by what’s happening at this week’s Mobile World Congress in Barcelona, there’s plenty of AI action being delivered via current flagship smartphone launches. (Even otherwise, AI is everywhere, whether in stock prices and market chatter. And chip-maker Nvidia is grabbing all that attention.)
Of course, all eyes will be on what the iPhone 16 will come up with, in the second-half of the year. How much of AI features will that take on - and would that be the prod for a blockbuster Q4-2024? As for this moment, Apple's current retail handset, the iPhone 15 too has had a sales lift in UAE.
But the handset market sure has turned to AI...
