Worldwide smartphone shipments are forecast to grow 39.3 percent to 1.01 billion units this year, driven mainly by robust demand in emerging markets in Latin America and the Asia-Pacific region, market researcher International Data Corp (IDC) said in a report yesterday.
By 2017, total worldwide smartphone shipments are expected to reach 1.7 billion units, representing a compound annual growth rate of 18.4 percent during the period from this year to 2017, IDC said.
“The key driver behind smartphone volumes in the years ahead is the expected decrease in prices,” IDC analyst Ramon Llamas said.
“Particularly within emerging markets, where price sensitivity and elasticity are so important, prices will come down for smartphones to move beyond the urban elite and into the hands of mass market users,” Llamas said.
“Every vendor is closely eyeing how far down they can price their devices while still realizing a profit and offering a robust smartphone experience,” he added.
For this year, IDC forecast that the average selling price of smartphones would decline 12.8 percent to US$337 from US$387 last year.
The average price was estimated to slide further to US$265 by 2017, as IDC forecast the trend would continue in years to come.
“Despite a number of mature markets nearing smartphone saturation, demand for low-cost computing in emerging markets continues to drive the smartphone market forward,” IDC said.
By region, smartphone shipments to Latin American countries are forecast to grow at the most by 23.7 percent to 154.7 million units in 2017 from 91.1 million units this year.
Shipments to countries in the Asia-Pacific region are forecast to achieve the second-highest growth rate of 23.2 percent to 986 million units in 2017, followed by shipments to nations in the Middle East and Africa at an 18.5 percent growth rate to 95 million units, and an 11 percent increase to 261 million units to European countries, IDC said.
The average selling price of smartphones is forecast to decline to the lowest levels in the Asia-Pacific market, to US$215 in 2017; followed by Middle East and African countries, at US$230; in Latin American countries, at US$246; in Europe, at US$259; and in North America, at US$567, IDC said.
“The game has changed quite drastically due to the decline in smartphone average selling prices,” IDC analyst Ryan Reith said.
“Just a few years back the industry was talking about the next billion people to connect, and it was assumed the majority of these people would do so by way of the feature phone,” Reith said. “Given the trajectory of average selling prices, smartphones are now a very realistic option to connect those billion users.”