5G Smartphones set to overtake 4G models as forecasts anticipate a 12 percent growth in global smartphone shipments
According to a recent report, the smartphone market will enjoy a 12% growth in 2021. This growth will involve global smartphone shipments, reaching the 1.4 billion units mark. The forecast of the global smartphone shipments growth speaks of a strong recovery in smartphone shipments from the adverse effects of the global pandemic in 2020, which saw the market dip significantly.
Most smartphone manufacturers already have their new 5G models released, or are in the final phase of manufacturing, and these new releases will greatly contribute to the expansion of the 5G smartphone market. By 2022, analysts predict that the shipments of 5G models will overtake 4G smartphones.
According to a prediction by market analyst company Canalys, the 12% growth of smartphone shipments worldwide in 2021 is an improvement from the 7% fall in the global smartphone shipments reported in 2020.
An estimated 18% of this growth is expected to come from Latin America, followed by China, Europe, the Middle East, and Africa, as well as the Asia Pacific.
Canalys global smartphone forecast and growth.
Region |
2020 shipments (million units) |
2021 Shipments (million units) |
2022 Shipments (million units) |
Annual growth |
Annual growth |
Asia Pacific |
351 |
381 |
426 |
+8% |
+12% |
EMEA |
314 |
355 |
370 |
+13% |
+4% |
GreaterChina |
341 |
394 |
400 |
+16% |
+1% |
Latin America |
108 |
126 |
133 |
+18% |
+5% |
North America |
151 |
159 |
157 |
+6% |
-2% |
Total |
1,265 |
1,416 |
1,484 |
+12% |
+5% |
Although the rollout of the Covid-19 vaccine and subsequent contraction in the number of reported cases worldwide suggest a positive effect on the global smartphone market, component supply bottlenecks indicate a limit to the growth potential of the smartphone market in 2021. Due to the recent surge in the coronavirus cases in India, some vendors redirected some of their allocations to other regions.
The ongoing challenges in the smartphone market are expected to motivate smartphone vendors to prioritize their efforts and focus on more lucrative and developed markets such as China, Western Europe, and the United States at the expense of less developed or lucrative markets like Latin America and Africa. It is also expected that vendors would opt for greater allocation of units to channels known for fast activation and allocate fewer units to the open market.
Another expectation is that smartphone companies will introduce innovative methods in their supply in response to the shift from the norm as a result of a pandemic.
According to Canalys research manager Ben Stanton, Covid-driven innovations include unified stock and delivery-to-car. These innovations are helping retailers shift towards their consolidated omnichannel vision. Centralized procurement is also expected to give the channel more negotiating power with smartphone manufacturers, which may result in an attempt to bypass distribution and build new direct relationships by retailers. The new norm in the smartphone industry is as competitive and ruthless as the old one.
The prices of smartphone components such as chipsets and memory are expected to spike, which may result in smartphone vendors having to decide whether to absorb the price increase or allow it to reflect on the prices of their smartphones. The challenges surrounding the LTE chipsets are also quite likely to bring about the difficulty for vendors targeting the low-end market segment in particular.
However, Canalys predicts that 5G smartphone shipments worldwide will hit the 610 million unit Mark by the end of 2021, accounting for about 43% of global smartphone shipments for the entire year. This figure is about a 6% increase compared with the 43% shipments of 5G smartphones reported in the first quarter of 2021.
Stanton stated that the growth of global 5G smartphone shipments will be driven by intense price competition between vendors, with many vendors sacrificing other features, such as display or power to accommodate 5G in the cheapest possible device.
Stanton also added that by the end of 2021, about 32% of all 5G smartphones shipped worldwide will cost under $300.
Canalys is not alone in its prediction about the smartphone market growth and expansion of 5G models. Gartner, the Connecticut-based research farm, in February forecast 11.4% year-over-year growth in the global smartphone market which could translate to 1.5 billion smartphone units in 2021.
The international data corporation (IDC) also earlier in 2021 predicted that the global smartphone shipments will grow by about 5.5% in 2021 and 5G models will account for about 40% of the worldwide total smartphone shipments.
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