Smartphone Shipments Record First Ever Decline, Gartner Warns

Global shipments of smartphones have declined for the first time as users opt to purchase “quality” smartphones and hold onto them longer.

This is according to the latest data from Gartner, and it also said the slowdown was also down to the fact that there was a “lack of quality ‘ultra-low-cost’ smartphones.

In terms of market share, Samsung is still the market leader, closely followed by Apple. Huawei and Xiaomi were the only vendors to experience growth in the fourth quarter.

Declining Shipments

Gartner said that the fourth quarter of 2017 nearly 408 million smartphones were shipped, a 5.6 percent decline over the fourth quarter of 2016.

“This is the first year-on-year decline since Gartner started tracking the global smartphone market in 2004,” the analyst house said.

“Two main factors led to the fall in the fourth quarter of 2017,” said Anshul Gupta, research director at Gartner. “First, upgrades from feature phones to smartphones have slowed down due to a lack of quality ‘ultra-low-cost’ smartphones and users preferring to buy quality feature phones.”

And Gupta pointed out that people are holding onto their handsets for longer, and there were few technology advances to encourage people to upgrade.

“Second, replacement smartphone users are choosing quality models and keeping them longer, lengthening the replacement cycle of smartphones,” said Gupta. “Moreover, while demand for high quality, 4G connectivity and better camera features remained strong, high expectations and few incremental benefits during replacement weakened smartphone sales.”

This is borne out by Apple’s latest financial results, which showed that sales of the iPhone had declined over the past three months.

There has also been criticism that Apple’s much vaunted iPhone X failed to include enough new tech to encourage people to upgrade.

Android remains by far the most smartphone popular operating system with 85.9 percent market share.

Apple’s iOS only has a 14 percent market share in comparison.

Other OSs accounted for less than 0.1 percent, as Microsoft’s retreat from mobile means that abandoned Windows Phone users switch to other platforms.

Market Leaders

In terms of the major smartphone players, Samsung still retains the top spot with an increased market share of 20.9 percent.

Apple is in second, but its market share declined to 14 percent from 14.4 percent in Q4 2016.

Huawei is third (9.8 percent), OPPO (Chinese handset maker) is fourth (7.3 percent), followed by Vivo (another Chinese hadnset maker) in fifth (6.5 percent) and others (41.5 percent).

Huawei and Xiaomi were the only smartphone vendors to achieve year-on-year unit growth.

“Future growth opportunities for Huawei will reside in winning market share in emerging APAC and the US,” said Gupta. “Xiaomi’s biggest market outside China is India, where it will continue to see high growth. Increasing sales in Indonesia and other markets in emerging APAC will position Xiaomi as a strong global brand.”

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