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AU’s smartphone market suffers record decline

18 Mar 2019
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The smartphone market in Australia is going through some tough slog at the moment, but there is some good news on the horizon.

According to new findings from IDC’s Quarterly Mobile Phone Tracker, 2018Q4, February 2019, the market underwent a 9 percent year-on-year (YoY) decline in unit shipments in 2018. IDC says this smartphone shipment decline represents the largest in any year to date, falling to just under AUD 8.2 million in 2018.

The past three years has seen significant fluctuation in the Australian smartphone market. IDC’s data shows that in 2016 there was a 6.6 percent YoY decline in shipments, which was directly followed by a 6.5 percent increase in 2017 (which IDC has put down to the market’s reception to the iPhone X), and then of course in 2018 the market took a 9 percent hot.

“An overall lack of innovation and improvement in smartphones in recent years is extending replacement cycles,” says IDC Australia Mobile Phones market analyst John Riga.

“This is in line with the trend seen in other developed markets, where many consumers are holding off on upgrading to the latest device. At a local level, economic factors also drove this decline, with falling consumer sentiment indicating lower demand and minimal real wage growth limiting household disposable income."

However, despite this rather grim state of the market (for vendors and resellers at least), IDC has predicted an upturn in 2019 where the market will stabilise in comparison to the heavy decline in 2018, with an estimated decline of 0.8 percent YoY.

"With 5G devices and network infrastructure expected to be launched from 2019 in Australia, as well as the anticipated introduction of foldable phones, there may be some positive movement in the market," says Riga.

"However, given the high price point likely to be attached to these devices, they will take time to gain a significant foothold in the market. For this reason, while they may generate some consumer enthusiasm, it is unlikely they will significantly impact the struggling mobile phone market."