Things are starting to go from bad to worse for the likes of Telstra after new research reveals that smartphone sales are set to plunge this year. Microsoft Windows based smartphones sales are set to plunge by more than 60%
IDC Research reveals that smartphone shipments are expected to substantially slow in 2016, with declines from Apple, HTC, Microsoft who recently dumped their Nokia branded smartphones and Sony who have become a smartphone basket case substantially impacting the market.
Total worldwide shipments are projected to grow by 3.1% in 2016, versus 10.5% in the year-earlier period and 27.8% in 2014, according to IDC, which tracks mobile device trends. That’s down from IDC’s previous forecast in early March, which called for growth of 5.7%.
Devices powered by Alphabet’s Android are expected to grow by 6.2% to 1.24 billion shipments, while Apple is expected to face its first down year, dropping by 2% to 227 million iPhone units, from 232 million in the year-earlier period.
This follows Apple’s first quarterly decline in iPhone sales, and its first overall sales decline since 2003.
Microsoft’s Windows phones are expected to decline by 62%, though Windows comprises a fraction of the total market, with shipments expected to come in at 11.2 million.
By geographic region, the growth is expected to be led by large markets like the U.S., Australia Western Europe and China, despite the fact that Apple reported a 26% year-over-year decline in China last quarter. Japan and Canada are expected to contract by 6.4% and 6.9%, respectively.
IDC blamed part of the slowdown on a shift in how people are buying their smartphones, with more people opting to go through electronic retailers, which enables them to be savvier with how and when they buy mobile devices.
Smartphones sold into e-tailer channels grew 65% in 2015 and are expected to account for roughly 12% of smartphone shipments in 2016, up from just 4% in 2013.
Traditional device manufacturers are now trying to figure out how to stop the smartphone life cycle from extending further, according to IDC. One way to do that on the premium side is through trade-in programs, such as the one Apple recently started facilitating. On the lower end, devices like those running Android might want to consider offering a broader range of cheap unlocked devices.
Despite the slowdown, one area that is expected to continue to shine at least through 2020 are phablets – bigger screen smartphones such as the iPhone 6 Plus. IDC is expecting those devices to experience double-digit growth until 2019.
Overall smartphone shipments are expected to rise 24.3% through 2020, reaching 1.84 billion from an estimated 1.48 billion this year.
