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Why Smartphone Shipments will Double by 2016

According to the latest market study by NPD DisplaySearch, smartphone shipments are forecast to reach 567 million in 2012, and nearly double by 2016 as new phones continue to enter this established market.

"Apple’s iPhone 5 will be a key product for the smartphone market in the second half of 2012. Apple shipped more than 140 million phones in 2010 and 2011, so we can expect smartphone shipments to continue flourishing as users upgrade to the new iPhone," said Hiroshi Hayase, vice president at NPD DisplaySearch.

Despite the excitement surrounding the new Apple iPhone, the volume of new smartphone shipments is actually lower than they had expected. Therefore, NPD DisplaySearch downgraded its 2012 forecast of new purchases from 220-230 million to 177 million devices.

The volume of replacement phones, however, is expected to increase as new smartphones enter the market. The upside potential of the replacement market will likely become the forward-looking focal point for industry analysts.


"The timing of mobile phone contracts can also impact the smartphone market," said Hayase. "More service providers are likely to shorten mobile phone replacement cycles in an effort to boost sales."

In addition to creating excitement among Apple fans, the iPhone 5 is expected to implement new component and system technologies. NPD DisplaySearch expects that Apple will move to use a slightly larger display on all new devices.

Moreover, the iPhone 5 will have the same Retina display technology with 326 ppi, which will result in a wider screen format of 1136 × 640 pixels.

One of its most anticipated new technologies is in-cell touch, using a touch sensor integrated into the display panel. This approach can improve the performance of the display, and most importantly, reduce the thickness of the display-sensor combination by as much as a half-millimeter.

NPD DisplaySearch also expects that Apple will utilize the increased space of the device for a larger battery -- thereby requiring less frequent charging.

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