Emerging smartphone market to grow at 6x vis-a-vis mature market

In 2014, smartphone market in emerging market will grow at 6X vis-a-vis mature markets as per IDC Worldwide Quarterly Mobile Phone Tracker.

In 2014, IDC expects mature markets will grow at 4.9 percent while emerging markets will continue to soar at 32.4 percent, pushing the total smartphone market up by 23.8 percent.

According to a new mobile phone forecast from ICC, more than 1.25 billion smartphones will be shipped worldwide in 2014, representing a 23.8 percent increase from the 1.01 billion units shipped in 2013. Looking ahead, total volumes are forecast to reach 1.8 billion units in 2018, resulting in a 12.7 percent compound annual growth rate (CAGR) for the  2013 – 2018 forecast period.

In 2014, IDC expects emerging market smartphone volume to grow to 920.8 million units accounting for 73.5 percent of all volume shipped. The catalyst here continues to be Android devices, which are expected to account for 88.4 percent of this volume. IDC’s outlook for emerging market smartphone volume is 1.4 billion units by 2018, growing to 79.5 percent of worldwide volume.

“Mature markets have slowed considerably but still deliver strong revenues with average selling prices over $400. Meanwhile, many emerging markets are still barreling along, but with ASPs of less than US$250,” said Ramon Llamas, research manager, Mobile Phone, IDC.

“The key for vendors now is to maintain a presence in the higher-margin mature markets, while establishing a sustainable presence within the fast-growing emerging markets. To enable this strategy, operating system companies are partnering with OEMs to provide low-cost handsets,” added Llamas.

“The support that Google’s Android platform has received from over 150 handset manufacturers has allowed it to gain the share it has in emerging markets,” said Ryan Reith, program director, IDC.

“The lack of constraints around hardware and software specifications has helped bring to market many low-cost products, a lot of which could be considered borderline junk. With Google’s recent announcement of Android One, they hope to change this by laying out a set of standards for manufacturers to follow,” added Reith.

IDC expects “phablets” (smartphones with 5.5″—7″ screens) to grow from 14 percent of the market in 2014 to 32.2 percent of the market in 2018. With the expected entry of Apple into this market segment, and the pent-up demand for a larger screen iPhone, Apple has the ability to drive replacement cycles in mature markets despite the slower growth seen in recent quarters.

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