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Smartphone Industry Overview

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Industry Overview

It was in 1995 that the first smartphone was released, the IBM Simon, followed by the release of Blackberry series in 2001 that acted as a catalyst for the growth of smartphone industry. But, the impetus for boom in the industry was the release of Apple’s iPhone in 2007 that ran on iOS.  In 2008, Android smartphones were launched which emerged as the main rivals to iPhone. Samsung manufactures smartphone devices that run on Android. The world is witnessing rapid smartphone penetration since the past decade and the trend is expected to continue, albeit at a gradually slowing rate as the customer base gets larger. Smartphone penetration has begun to max out in developed countries, US and UK have smartphone penetration levels at about 80%, but is still very low in developing countries like India and China, which have 27% and 45% penetration levels. India’s smartphone market share is expected to increase from 7.6% in 2015 to 13.49% in 2019. Middle East and Africa region saw 50% growth year over year in 2015, surpassing “hot growth” markets like India and Indonesia.

According to BidnessEtc, smartphone industry size is estimated to be $376 billion by 2015. Out of a total of 1.83 billion mobile shipments, smartphone shipments stood at staggering 1.01billion. 84% of industry profits are taken away by Apple. According to Statista, global market share of Samsung has slumped from its peak of 32.5% in Q3, 2013 to 21.4% in Q4, 2015. In India, Samsung had the largest market share of 24%, comfortably ahead of Micromax, which had 16.7% market share in Q3, 2015, according to IDC. By the same source, Android’s market share in 2015 is about 80% to that of 16% held by iOS in 2015. Market share of Android is expected to be static at 80% while iOS’ market share will dip to 14% by 2019. When it comes to pricing, top of the line smartphones are routinely sold in excess of $600, growing number of smartphones are priced far lower, even as low as $50, and are accounting for much of the global smartphone growth. Rise of low cost smartphone manufacturers like Xiaomi and Micromax respectively, have much contributed much to the slump of Samsung and Apple in the past 2-3 years. Android is estimated to grow at 7.8% CAGR from 2015-19, compared to iOS’ 7%. Global smartphone shipments have increased from 173.5 million in 2006 to 1284 million in 2015, and are expected to grow further to 1873 million in 2018.  Globally, Samsung shipments stood at 288.79 million units in 2015, witnessing a dip in growth of 4.1% from 2014. At the same time, Apple’s global unit wise sales were 231.22 million in 2015, a growth of 36.6% over sales in 2014.



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