Business Journal

IT & Telecom

China 2012: The Emerging Largest Smartphone Market on Earth

China is set to become the world’s largest smartphone market in 2012 while Brazil and India are forecast to enter the top five markets by 2016, according to research firm, IDC.
IDC’s Worldwide Quarterly Mobile Phone Tracker forecasts that China will move ahead of the US in terms of overall smartphone shipments this year and extend its lead in the years ahead.

Android devices priced under US$200 will be the main driver for growth in China with prices likely to fall further. In addition, Chinese handset makers Huawei, Lenovo and ZTE are likely to continue to secure large operator deals, while Nokia and Samsung will drive low-end volumes with cheaper smartphones.
India is expected to see “galloping growth” as 3G services are rapidly rolled out and international OEMs invest further in local manufacturing capability. “Demand for smartphones will also grow as urban and enterprise users mature in their handset preferences and usage,” said G. Rajeev, senior market analyst for mobile devices at IDC India.
Meanwhile, increased discretionary income for Brazilians due to a booming economy and low inflation will drive greater smartphone use, the firm says. A shift from feature phones to smartphones is already taking place as smartphone prices fall and prepaid data plans have become more common.
However, there will be challenges to growth in emerging markets, according to Ramon Llamas, senior research analyst with IDC’s Mobile Phone Technology and Trends team.
The total cost of ownership of devices will be one a hindrance to many potential smartphone buyers. “Smartphones still represent a significant investment for consumers in many countries,” Llamas said, adding that operators need to “creatively subsidise device cost and data plans.”
IDC also forecasts that smartphone shipments to emerging markets will drive overall growth in the global smartphone market. More mature markets such as Japan, the UK and US, will continue to see growth but are unlikely to keep pace with emerging markets. “Due to their sheer size, strong demand, and healthy replacement rates, emerging markets are quickly becoming the engines of the worldwide smartphone market,” Llamas said

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