Smartphone manufacturers need to get the 5G and foldable phones out as soon as they can on the cooling market
While experts believe that the market is stabilizing due to saturation, there’s a chance that features such as 5G and foldable phones may boost sales when they emerge on the market.
Of course, the device price is important, since not many people really want to get a new gadget for the sake of just one feature, especially in the poorer population groups.
The recently steaming-hot sector of economy that is the smartphone market is slowing down, with various factors responsible, such as high retail prices.
Recent surveys demonstrate that 2018 was, in fact the year when the global markets contracted the most, and 2019 is not looking like it’s going to bring any relief from that trend.
Analysts don’t believe that the market is down and out, since owning the smartphone is a must for increasingly greater number of people internationally.
There really isn’t anything to replace the convenience of a smartphone, and nothing in sight either. Wearables do not even come close, so for now smartphones are safe.
Last year international handset volumes have dropped 4.1% to 1.4 billion units shipped, say the industry experts at IDC, who also predict further decline in 2019.
The end of 2018 saw a certain stabilization of the market, says another group of analysts at Gartner.
Mobile phones aren’t going anywhere, but some disruptive features, such as foldability, are likely to bring in perks in terms of sales volumes.
Other high-tech devices, i.e., personal computers, are also susceptible to similar issues with wave-like course of sales over the years.
Some ebbs and flows are normal for any market, and manufacturers sometimes need to spend more on advertising and promotion in order to egg on their potential consumers.
Seeing the prices rise in the premium segment, a number of consumers is likely to be delaying the replacement of their smartphones.
Tim Cook, Apple’s CEO also agrees that this is the case. He believes that the reason for a slowdown in iPhone sales is related to the subsidy cutbacks for devices tied to service contracts, which leads to customers facing the need to pay the full price of $1,000 or more for premium models.
Thus, if their phones are still functioning well, many don’t find it necessary to replace their devices as often.
This is particularly relevant in the emerging markets, where people certainly aren’t willing to give up their daily bread in order to be able to buy an expensive smartphone.
In fact, with regard to this consideration, Apple actually lowered its retail prices in some emerging markets in order to offset the effects of a strong US dollar.
January is the month when this change took place, with Apple absorbing part of the foreign currency losses to return to a price level to similar to that of about a year ago.
In any case, the most recent data demonstrates that the red-hot bullish smartphone market is no longer as impressive, and the many of the saturated markets are faced with contraction or slow growth.
Fourth-quarter revenue slump experienced by Apple and a drop in Samsung’s net profits in the same time period are due to a clear drop in demand in its main products. The international global market is generally in a state of flux, say the analysts.
There are still several high-growth markets, such as South Korea, India, Indonesia and Vietnam, which have yet to reach a point of saturation, there wasn’t much positive activity last year.
Political and economic flux add to the state of uncertainty in the market, in addition to the increasingly longer ownership time prior to replacement and the rising prices in the premium segment.
The Chinese market showed particularly unfortunate figures, with a 10% drop in 2018, and considering the fact that China accounts for about 30% of the global market, it’s a significant number.
Chinese manufacturers, however, such as Huawei, Oppo and Xiaomi, went against the trend and reported gains in revenue at year-end 2018.
In 2019, there will probably be a move by device manufacturers to introduce innovative features, such as the top-speed 5G connectivity and foldable screens. In fact, Samsung has an upcoming presentation of a foldable-screen phone in the end of February.Source