Latin America, Emerging Markets, Drive Shift in Tech Industry's Priorities
Last year marked the first time smartphones outsold cheaper feature phones globally, but according to a new report, the smartphone frenzy is expected to slow down this year and into the near future. For PC makers, the computer market looks even worse.
Smartphones' Peak and Slow Decline
Technology market researcher International Data Corporation released a report predicting that the smartphone industry can expect a cool down in sales and shipments, starting this year and going into 2018.
This comes after a meteoric rise in smartphone purchases across the globe, where shipments of smartphones in 2013 topped 1 billion for the first time ever, according to USA Today. As we previously reported, 2013 was the first year when smartphone sales outpaced cheaper "feature" phones across the globe, accounting for nearly 54 percent of overall mobile phone sales. That's an increase of some 42 percent from 680 million smartphones sold the previous year.
IDC predicts that, while the party's not exactly over for smartphone manufacturers, it's certainly getting close to last call. IDC expects growth in smartphone shipments to slow down year by year, starting in 2014 with an increase in shipments of 19 percent. By 2018, IDC predicts smartphone sales increases to drop to 6.2 percent.
Latin America and Emerging Markets
One of the only segments driving smartphone adoption in the future will be new markets in places like Latin America and Asia, though China's smartphone market -- which is the biggest in the world -- also looks like it is maturing and slowing down.
Some of the regions with the strongest growth at the end of last year were in Africa, the Middle East, Eastern Europe, and Latin America. Sales in Latin America, according to a previous LatinPost report, peaked at 96.1 percent growth during the last quarter of 2013, for example.
This means a shift towards less emphasis on "premium" smartphones and towards providing competitive devices for emerging and lower-income markets at a low cost -- something which we previously predicted would happen when the HTC One, a success with top tech critics, turned out to be a strategic mistake.
"Not only will growth decline more than ever before, but the driving forces behind smartphone adoption are changing," said IDC's Program Director Ryan Reith in a release. "New markets for growth bring different rules to play by and 'premium' will not be a major factor in the regions driving overall market growth."
Emerging Markets Tanking PC Sales
In a more recent report by IDC, released Tuesday, the research company found that worldwide PC shipments fell by nearly 10 percent in 2013, and that trend is only expected to continue into the near future. IDC predicts a growth of less than 1 percent next year, with a general stagnancy for the PC market going into the foreseeable future.
Once again, emerging markets like those in Latin America are the biggest mover behind the trend. The 9.8 percent drop last year was led by an 11.3 percent decline in emerging markets, as consumers trended towards mobile devices instead of traditional computers.
"Emerging markets used to be a core driver of the PC market," said Loren Loverde, an analyst for IDC, in a statement. "At the moment, however, we're seeing emerging regions more affected by a weak economic environment as well as significant shifts in technology buying priorities."
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