Used smartphones a 'disruptive force' to the global market

The market for used and refurbished smartphones has witnessed rapid growth over the past several years, according to IDC.

IDC's latest report, Worldwide Used Smartphone Forecast - 2016-2020, shows a wide variety of trade-in and buyback programs across multiple channels and platforms.

These types of programs have appeared in Asia, the United States and Western Europe over the past three to five years.

IDC predicts that the market for used smartphones will grow from 81.3 million devices in 2015 to 222.6 million units in 2020.

Anthony Scarsella, research manager for IDC's Mobile Phones program, says the demand for refurbished smartphones is already becoming constrained in some countries.

"Mobile operators are the most constrained given the need for replacement devices for customers who have purchased device insurance plans,"he explains.

"In addition, used handsets provide an additional option for customers with subprime credit making them ineligible for equipment installment plans. With the average selling price for a used device expected to be $136 in 2020, the total market value for used devices in 2020 will be an estimated $30 billion.

According to IDC's taxonomy, a refurbished smartphone is a device that has been used and disposed of at a collection point by its owner.

Will Stofega, program director of Mobile Phones at IDC, says the used smartphone market will impact OEMs, mobile operators, and component suppliers.

"Thus IDC has committed new resources to help customers understand and plan for this new and potentially disruptive force," he explains.

"Although there is a potential downside to mobile ecosystem suppliers, IDC believes that the used smartphone market also presents new opportunities to grow revenue and increase market share.