Consumer Electronics
Troubled Smartphone Market May Hurt Apple Badly
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A new IDC study shows that smartphone sales will be flat this year. That means Apple Inc. (NASDAQ: AAPL) will release the iPhone 7 into a stagnate market.
According to IDC:
Worldwide smartphone shipments are expected to reach 1.46 billion units with a year-over-year growth rate of 1.6% in 2016 according to the latest forecast from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker. Although growth remains positive, it is down significantly from the 10.4% growth in 2015. Much of the slowdown is attributed to the decline expected in developed regions in 2016, while emerging markets continue with positive growth. Developed markets as a whole (United States, Canada, Japan, and Western Europe) are expected to see a compound annual growth rate (CAGR) of -0.2%, while emerging markets (Asia/Pacific excluding Japan, Central and Eastern Europe, Middle East and Africa, and Latin America) will experience a CAGR of 5.4% over the 2015-2020 forecast period.
Jitesh Ubrani, senior research analyst with IDC’s Worldwide Quarterly Mobile Device Trackers, wrote that the problem may be more than just a slow environment:
Growth in the smartphone market is quickly becoming reliant on replacing existing handsets rather than seeking new users. From a technological standpoint, smartphone innovation seems to be in a lull as consumers are becoming increasingly comfortable with “good enough” smartphones.
Going out to 2020, IDC expects Apple’s market share to drop slightly.
| Worldwide Smartphone Shipments by OS, Market Share, and Annual Growth (shipments in millions) | |||||||
| Platform | 2016 Shipment Volume* | 2016 Market Share* | 2016 YoY Growth* | 2020 Shipment Volume* | 2020 Market Share* | 2020 YoY Growth* | 5 Year CAGR* |
| Android | 1,246.2 | 85.3% | 6.7% | 1,507.1 | 85.7% | 4.4% | 5.2% |
| iOS | 203.8 | 13.9% | -12.0% | 249.2 | 14.2% | 3.4% | 1.5% |
| Windows Phone | 7.2 | 0.5% | -75.2% | 1.7 | 0.1% | -23.2% | -43.4% |
| Others | 3.9 | 0.3% | -56.5% | 0.8 | 0.0% | -3.9% | -38.7% |
| Total | 1,461.2 | 100.0% | 1.6% | 1,758.8 | 100.0% | 4.2% | 4.1% |
| Source: IDC Worldwide Quarterly Mobile Phone Tracker, September 1, 2016 | |||||||
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