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High-end market to drive smartphone shipment rebound in 2017

01 Jun 2017

A new forecast from the International Data Corporation (IDC) has revealed smartphone shipments are expected to rebound slightly in 2017.

In 2016, year-over-year growth was just 2.5 percent, marking the lowest growth industry has experienced. In 2017, this is expected to increase to 3 percent.

IDC expects shipment volumes to grow to 1.52 billion this year with several major devices entering the market, and IDC expects this momentum to carry into 2018 when smartphone shipments volumes are forecast to grow 4.5 percent year-over-year, fuelled by improved economic conditions in many emerging markets and a full year of new iPhone shipments from Apple.

Program vice president with IDC's Worldwide Quarterly Mobile Device Trackers, Ryan Reith says 2016 was an interesting year for smartphones with some high-growth markets down and other mature markets like the U.S. and China outpacing global growth rates.

"Looking ahead, we continue to believe several factors will enable the smartphone market to regain some of its momentum. First and foremost is that less than half the world's population is currently using a smartphone, and markets like the Middle East & Africa, Central & Eastern Europe, and Southeast Asia still have plenty of room to grow,” Reith says.

“In addition, as consumers continue to demand more from their smartphones we expect to see a large portion of the installed base that is currently using low-end devices begin to seek a more robust experience on more capable devices. Media consumption, gaming, augmented and virtual reality, and constant connectivity are drivers of this trend."

Of course, the other big topic in the smartphone world is the intense and bloody fight for the high end of the market. Samsung has made a lot of noise with its recent Galaxy S8 and S8+ device launches, largely extinguishing the fires of the Note 7 from last year.

Meanwhile, all signs point to late 2017 being one of Apple's biggest, if not the biggest, product announcements with the highly anticipated next round of iPhones.

While IDC has seen massive growth of the low-end smartphone market in the past few years, the company still expects the high-end market will continue to hold its place in the industry.

Advancements in computing, display technology, cameras, and storage are expected to continue to create the need for high-end users to refresh their devices.

Research manager with IDC's Worldwide Quarterly Mobile Phone Tracker, Anthony Scarsella says with the ongoing fight at the high end, vendors will need to find a way to innovate ahead of the curve to attract new users and increase shipments while driving profits.

"The display looks like it could be the next battlefield for the smartphone over the next couple years. We have seen both Samsung and LG opt for new borderless 18:9 displays and Apple could be set to join the party later this year,” Scarsella says.

“As smartphone owners continue to consume media on their devices, the screen (bigger, brighter, and bolder) will be an integral part of the overall design language for each vendor. From flexible to foldable and everything between, 18:9 displays look to be just the beginning of what's to come."

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