Worldwide Smartphone Shipments Fall 0.5 Percent in 2017, for First Time Ever: IDC

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Worldwide Smartphone Shipments Fall 0.5 Percent in 2017, for First Time Ever: IDC
Highlights
  • A total of 1.46 billion smartphones were shipped in 2017
  • IDC expects the market to grow in 2018
  • China and EMEA markets contributed most to the fall

International Data Corporation (IDC) on Tuesday published its Quarterly Mobile Phone Tracker that reveals worldwide smartphone shipments declined 0.5 percent in 2017, which is incidentally the first time that the global market has witnessed a Year-on-Year (YoY) decline ever since "smartphones" were introduced, as per IDC. A total of 1.46 billion handsets - vast majority running Google's Android or Apple's iOS - were shipped in 2017. However, IDC expects growth to return in 2018 with an expected volume of 1.68 billion units in 2022, with a CAGR of 2.8 percent over the 2017-2022 period.

The IDC report claims that innovation in technology has been focusing on software and phone internals, with external hardware design taking a slight backseat. This has apparently reduced product differentiation in the market. Another interesting takeaway from the report is that IDC expects phablets (large screen phones) to "outship" regular smartphones, owing majorly to flagship smartphones such as the Samsung Galaxy S9 and Apple iPhone X.

Talking about forecasts in the smartphone industry, IDC states that 5G is all set for commercialisation in the next few years, with 5G-capable handsets expected to account for up to 18 percent of all smartphones by 2022.

"2017 turned out to be the year we all knew would eventually come - when smartphone volumes finally experienced a contraction. That fact that China alone declined almost 5 percent in 2017 was a huge factor for why global volumes fell, but EMEA also declined 3.5 percent,and the US market was flat. In our opinion, areas for growth have not changed. Developing markets still have plenty of room for buildout, led by first-time buyers. And the premium space will continue to represent roughly 20 percent of the market. However, competition will continue to tighten and consolidation is inevitable," said Ryan Reith, Vice President at IDC's Worldwide Quarterly Mobile Device Trackers.

According to the IDC report, Android smartphones accounted for 85.1 percent of the market share in 2017 with over 1.24 billion shipments. On the other hand, almost 216 million iOS handsets were shipped as Apple's mobile operating system took 14.8 percent of the market last year. Other mobile operating systems - such as Blackberry OS and Windows Phone - came last with just 0.1 percent of the market (2.2 million shipments).

Apple, however, saw a marginal 0.2 percent growth in the same period that was attributable to the large screen models such as the latest iPhone X, with with 64 percent of its sales coming from 'Plus'-sized iPhone models include the iPhone X. IDC says that overall iPhone volumes are expected to grow at a CAGR of 2.4 percent over the 2017-2022 five-year period. Apple's device repair programme might prove to be a major catalyst for its future growth.

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