Smartphone sales growth about to slow dramatically, warns IDC

The growth rate for smartphones is set to slow dramatically over the coming years, both in terms of volume and revenue, according to a forecast released this week by IDC.

The figures estimate a total of 1.288 billion smartphones will ship for the full year of 2014, with 82.3% (1.06 billion) Android smartphones, 13.8% (178 million) iPhones, 35 million Windows Phones, and 14 million others (including Firefox OS and BlackBerry).

The figures for 2014 represent a massive 26.3% increase over 2013, however, this growth rate is projected to slow dramatically over the coming years.

IDC’s figures anticipate shipments in 2018 will reach a total of 1.9 billion units in 2018, representing a compound annual growth rate (CAGR) from 2014 to 2018 of just 9%.

In 2018, IDC predicts 1.498 billion Android devices will ship globally, a CAGR of 9%. Apple shipments are predicted to grow at 7.8% per annum to 240 million units and Windows Phone will boom 31.4% per year to 105 million units. Other platforms will grow 20.4% per year to 30 million units.

The average outright selling price (ASP) of smartphones is expected to drop from $US297 worldwide in 2014 to $US241 in 2018, with the biggest drop in emerging markets, with ASPs in India set to crash from $US135 in 2014 to $US102 by 2018.

“While premium phones aren’t going anywhere, we are seeing increasingly better specs in more affordable smartphones. Consumers no longer have to go with a top-of-the-line handset to guarantee decent hardware quality,” IDC senior research manager Melissa Chau said.

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