Worldwide Smartphone Sales Will Take a Hit, India and China Likely to Become Largest Consumers: Gartner

BENGALURU: Growth rates in smartphone segment had managed to surpass other segments in the electronic devices category by a huge margin over the last seven years; even documenting stratospheric 73 percent growth in 2010. However, a new Gartner report predicts substantial slumping in the segment’s growth worldwide for the later year.

Much to the displease of smartphone vendors, 2016’s initial quarters have recorded growths nearly halved, from 14.4 percent growth last year to 7 percent. The report highlights that slower replacement rate, particularly in mature markets like North America, Western Europe, Japan and Asia Pacific where smartphone penetration is approximately 90 percent is a prime reason. “In the mature markets, premium phone users are extending life cycles to 2.5 years, which is not going to change drastically over the next five years,” said Anshul Gupta, Research Director at Gartner.

With lesser evolved markets demonstrating further growth potential, vendors are focusing on fast growing economies, particularly India and China. “India has the highest growth potential. Sales of feature phones totaled 167 million units in 2015, 61 percent of total mobile phone sales in India,” said Gupta. Falling average selling prices of smartphones in such markets along with a large and economically blooming vibrant middle class are the main drivers.

“In such a fluid vendor landscape, some will exit the market while newcomers, including mobile manufacturers or internet service providers from China and India, could make their debut,” said Annette Zimmermann, research director at Gartner.

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