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Mobile

Smartphone shipments fall for third year in a row

Smartphone shipments are set to fall for the third consecutive year but improved market conditions and the launch of 5G networks will see the market return to growth in 2020. 

New figures from IDC predict the number of devices sold in 2019 will be down 2.2 per cent, but the market will only contract by 0.4 per cent in the second half of the year. By 2020, growth will have risen to 1.6 per cent annually.

Analysts say the ongoing problems of saturation and longer refresh cycles have not been helped market uncertainty and the ongoing trade dispute between the US and China. However the arrival of 5G devices – although not a silver bullet – will help return the sector to growth.

Smartphone shipments

“The global smartphone market and relevant supply chains remain uncertain, largely due to fluctuations in U.S-China trade negotiations, making future planning even more challenging than normal,” said Sangeetika Srivastava, senior research analyst with IDC.

“Consumers continue to hold their devices for lengthier times making sales difficult for the vendors and channels alike. However, expectations of aggressive promotions and offers in the second half of 2019 aimed at helping to clear out any channel inventory and get consumers excited about the next wave of smartphone technology should steer the market back toward renewed growth.”

The first 5G networks have gone live in the UK, US and elsewhere, with Samsung, Huawei and others preparing the first tranche of compatible devices. IDC believes 5G will account for 8.9 per cent of all shipments in 0202, rising to 28.1 per cent by 2023.

“The anticipation of 5G, beginning with smartphones, has been building for quite some time but the challenges within the smartphone market over the past three years have magnified that anticipation,” added IDC’s Ryan Reith.

“To be clear, we don’t think 5G will be the saviour in smartphones, but we do see it as a critical evolution in mobile technology. We expect the 5G ramp on smartphones to be more subtle than what we saw with 4G, but that is primarily because we are in a much different market today.”

5G will mainly be a boon for Android, which will see its market share increase from 85.1 per cent to 87 per cent, with 1.2 billion shipments. Apple will have a more challenging year, partly because of a lack of 5G devices, with its share falling to 13 per cent (178 million units).

However IDC argues Apple will benefit from a more planned 5G launch in 2020 as it will have a better understanding of market conditions by going later.



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