Smartphone growth to slow in 2014: IDC

Despite strong 2013, era of high margins may be over; single-digit expansion by 2017

Tags: International Data Corporation
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Smartphone growth to slow in 2014: IDC IDC expects smartphone shipments to keep growing, but at a decelerated rate.
By  Stephen McBride Published  February 27, 2014

"In order to reach the untapped demand within emerging markets, carriers and OEMs will need to work together to bring prices down," said Ramon Llamas, research manager with IDC's Mobile Phone team.

"Last year we saw a total of 322.5m smartphone units ship for under $150 and that number will continue to grow going forward. We've already seen numerous smartphone announcements targeting this price band this year, with some as low as $25. Just as the dynamics have changed for overall smartphone growth, so have the dynamics for smartphone pricing in the markets where continued growth is expected. Not all vendors will want to get into this space, but those that do must make deliberate choices about their strategies in order to succeed."

Android will maintain its reign as the leading operating system throughout IDC's forecast. With a strong presence within emerging markets and attainable price points for both vendors and customers, IDC expects both a commanding market share as well as prices below the industry average. What remains to be seen is which vendors will win the contest within emerging markets, as many local vendors have gained share last year.

Apple's iOS will remain the clear number-two platform behind Android and will have the highest ASPs among the leading platforms. Apple has maintained a tight focus on the high end of the market with its most current devices, a trend IDC expects to see continue into the future. This could keep iOS from realising greater volumes within emerging markets, but sales in mature markets will offset much of the difference.

Windows Phone stands to grow the fastest among the leading smartphone operating systems, with continued support from Nokia as well as the addition of nine new Windows Phone partners. Most of these new vendors come from emerging markets and could help bring the Windows Phone experience to customers there.

IDC has taken a conservative stance on BlackBerry's future. The company's recent moves to shore up its presence with government and enterprise users as well as its strongholds within emerging markets will be under constant attack from the competition. However, its higher-than-average prices compared to other platforms could inhibit its growth potential.

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