Global smartphone sales dropped in the last quarter of 2017. This was the largest drop in the history of smartphones. Shipments of smartphones from the leading manufactures reduced by nine percent compared to the same quarter in the previous year. This is a difference of over 39 million smartphones. So what are the reasons for such a sharp decline in phone sales?
One of the main reasons for the sudden drop is the drop in demand in China. Demand for smartphones in China alone dropped by 16 per cent. China is the largest country in the world with the biggest market for mobile phones, so change in China is bound to cause ripples in the global market. There are a few reasons for the slump in demand in China. One of these reasons is longer replacement rates.
Smartphones are packed with more technology now than ever before, so they are costing more money. Consumers are holding on to their phones for longer before they decide to upgrade. The fact that smartphones are so expensive now, means that mobile phone operators are unable to offer the large subsidies that they used to.
Lacking the ‘wow’ Appeal
The lack of new and exciting features is the main reason why less people ordered a new smartphone. It could be the fact that the latest models are lacking the ‘wow’ appeal that previous models had. It could also just be that people have heard the rumours of folding screens and other exciting designs. They may be waiting to hear more about those before upgrading.
The slump in sales at the end of last year isn’t bad news for everyone. Technology giant Apple found itself with the largest share of the market, overtaking Samsung for the first time in a while – shipping 77.3 million smartphones in the last quarter.
It’s not all good news for Apple though. Despite an average iPhone selling price of over £550, global volumes have declined annually for 5 of the past 8 quarters. If Apple are serious about increasing shipping volumes in the next couple of years, then it could well be time for the launch of a cheaper iPhone model. Just like they did with the iPhone 5c.
Whatever happens, it’s looking as though we are well into the golden age of the smartphone, and 2018 is likely to be just as exciting as previous years have been. By the looks of things the main features to look out for in 2018 will be waterproof handsets and foldable screens. Hopefully 2018 could also be the year when Apple release a reasonably priced iPhone model.