Some 106 million mobile phones are expected to be shipped across Southeast Asia this year, marking a 19 percent increase from 90 million units last year, according to a new report Monday by Canalys.
The research firm further estimated that the number will increase to 163 million by 2015 at a compound annual growth rate (CAGR) of 39 percent. This region encompasses Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
"Southeast Asia has a diverse but dynamic smartphone market right now, thanks to a combination of mobile-savvy end-users and a favorable economic landscape," Rachel Lashford, Canalys' managing director of mobile and Asia-Pacific, said in the report.
Other key factors that will drive the region's smartphone expansion include Southeast Asia's positive economic outlook, operator eagerness from greater data subscription, strong social media usage among consumers, robust demand for mobility products and competitively priced phones.
Singapore is especially prominent, boasting one of the highest smartphone penetration levels in the region, where these devices accounted for the 61 percent of all mobile phones shipped in the country, compared to the global average of 23 per cent.
Canalys said this trend will carry on through 2011, with high-end devices accounting for the majority of 3.1 million smartphones expected to ship in Singapore.
Daryl Chiam, principal analyst at the analyst firm, said the three major mobile operators--SingTel, M1 and StarHub--in the country have "enticed consumers through their wide product portfolio, competitively priced data contract plans, attractive subsidies and strong marketing campaigns to promote smartphones". Chiam cited SingTel's close working partnership with HTC for the launch of the ChaCha smartphone last week as an example.
The research firm said strong growth is also predicted in emerging markets such as Indonesia, the Philippines and Vietnam but while high-end devices were the majority in Singapore, competitively priced mid- and lower- tier products will instead dominate these three markets.
Delving into vendor analysis, Canalys noted that Nokia remains well-positioned due to its wide distribution network, which is capable of driving significant volumes, and should not be underestimated. However, the handset maker will continue to face pressures as a result of the company's ongoing strategy and platform transitions.
Chiam noted: "Once Nokia is through transitional period and has delivered a Windows Phone-based product portfolio across several price points, it will re-establish itself as a formidable force in the smartphone market.
"Until then, other manufacturers will be looking to fill the gap," he said.
He pointed to BlackBerry maker, Research In Motion (RIM), which is expected to further expand in Southeast Asia, building on its success in Indonesia.
Fellow market player, HTC, will place prominence on growing its market share through a range of devices such as its aggressively priced smartphone offerings and Wildfire S.
Local brand names currently successful in the feature phone segment will also be eyeing the lucrative smartphone market. Spice, for instance, outlined plans to develop through acquisitions of local handset brands in Malaysia, Thailand and Indonesia.