Skip to main content

Smartphone Market in China is Reaching Saturation

Worldwide smartphone shipments are expected to grow by 11.3 percent in 2015, which is down from 27.6 percent in 2014, according to the latest global market study by International Data Corporation (IDC).

While overall smartphone growth will continue to slow as mature markets reach saturation, some markets will experience robust growth in 2015 and beyond. As a result, worldwide shipment volumes are forecast to reach 1.9 billion units annually by 2019.

IDC now expects 2015 to bring two notable milestones. First, they predict that this will be the first year in which China's smartphone growth, forecast to be 2.5 percent in 2015, will be slower than the overall worldwide market.

Second, Google Android smartphone growth is also expected to be slower than the worldwide market -- now forecast at 8.5 percent in 2015. IDC believes both trends will persist throughout the forecast period, which now goes out to 2019.

"Smartphone volume still has a lot of opportunity in the years to come, but two fundamental segments driving recent years' growth are starting to slow," said Ryan Reith, program director at IDC.


As reported earlier in May, smartphone shipments in China declined year-over-year in the first quarter of 2015, showing that the largest market in the world has reached a level of maturity where further growth will be harder to achieve.

IDC believes that this has implications for Google because China has been a critical market for Android-based smartphone shipments in recent years -- accounting for 36 percent of total volume in 2014.

That said, as Chinese OEMs shift their focus from the domestic market to the next high-growth markets, they will face a number of challenges, including competition from local brands.

In contrast to the overall market, IDC now expects Apple iOS smartphones to grow by 23 percent in 2015 and remain above worldwide market growth rates throughout the forecast period to 2019.

However, IDC believes a sizable portion of the recent Google Android gains were from those people who abandoned their old iPhone models for a more affordable larger screen Android smartphone. This may be a win-back opportunity for Apple. But the relatively high-price of new iPhones will remain a significant hurdle for Apple to overcome.

Popular posts from this blog

Frontier AI Peaked. Here's What Comes Next

The prevailing narrative around artificial intelligence (AI) has been one of relentless scale. Bigger models, bigger clusters, bigger budgets. The assumption, largely unchallenged until recently, was that raw parameter count translated directly into competitive advantage. New research from Omdia suggests it's time to retire that assumption. According to the latest market study by Omdia, parameter growth in frontier AI models has slowed to around 5 percent annually since 2021, a stark contrast to the more than hundredfold expansion seen between 2019 and 2021. Enterprise AI Market Development For executives who have been making infrastructure and investment decisions based on the assumption that AI would keep demanding ever-larger, ever-more-expensive hardware, this finding deserves serious attention. The race to the top of the model size leaderboard has, at least for now, plateaued. Crucially, Omdia's analysts are not reading this as an AI winter. Alexander Harrowell, senior pri...