The latest Quarterly Mobile Phone Tracker report by IDC has revealed that smartphone shipments are expected to grow 32.7% year over year in 2013 reaching 958.8 million units, up from 722.5 million units last year. 2013 will mark the first year that smartphone shipments surpass those of feature phones, with smartphones expected to account for 52.2% of all mobile phone shipments worldwide. IDC expects this trend to continue for years to come as demand for mobile data and handheld computing spreads across both developed and emerging markets. Emerging markets will account for 64.8% of all smartphones shipped during 2013, which is up from 43.1% in 2010.
Commenting on the insights, Ramon Llamas, Research Manager for IDC’s Mobile Phones program said,”2013 will mark a watershed year for smartphones. If you look at the number of vendors who support both feature phones and smartphones, many of them have not only successfully transitioned their product portfolios to highlight smartphones, but smartphones have become their primary value proposition going forward. In some cases, smartphones have accounted for well over 50% of their quarterly shipment volume. Looking ahead, we expect the gulf between smartphones and features phones to grow ever wider.”
The report found that with the rise in global smartphone shipments, demand has quickly spread from developed markets to emerging markets. As a result, smartphone average selling prices (ASPs) have declined to $372 in 2013, down from $407 in 2012 and $443 in 2011. As this trend continues, smartphone ASPs are expected to drop as low as $309 by 2017 with emerging market demand the main catalyst in this change. Computing at such low end-user cost has posed many challenges to handset OEMs and component suppliers.
“At a time when the global smartphone market is growing at 33% year over year, average selling prices have plummeted, dropping -8% in 2012 with another -9% expected this year,” said Ryan Reith, Program Manager for IDC’s Mobility Trackers. “Smartphones have become increasingly common in emerging markets and it is often the first affordable means of computing for these markets. These are markets where average personal income is far less than in developed markets, and therefore vendors have been forced to create smartphone computing experiences for the low end of the market.”
The IDC report revealed that by continuing to produce 3G smartphones alongside faster 4G smartphones, vendors have managed to keep costs down. Using older radio components has proven to be an easy cost-cutting measure for handset OEMs in the smartphone space. 3G-enabled smartphones will account for 70.9% of all smartphones shipped in 2013, and 50.1% of smartphones shipped in 2017.