Developing markets to spur 22.5 percent smartphone growth in 2013

Developing markets to spur 22.5 percent smartphone growth in 2013

Summary: Developing markets, led by China, will be the biggest contributors to the 837 million smartphones estimated to be shipped this year.

SHARE:
0

The global smartphone market will continue to see robust growth, with the majority of the predicted 22.5 percent market expansion in 2013 driven mainly by emerging markets such as India, Indonesia and China.

Canalys said in its report released Thursday that it is expecting to see 837 million units of smartphones shipped globally this year. The developing markets, particularly the BRIIC nations, are expected to contribute 70 percent to 80 percent of the 22.5 percent growth. BRIIC refers to Brazil, Russia, Indonesia, India and China, it noted.

In fact, the BRIIC nations will account for 38 percent of the total volume of smartphones expected to ship this year, the report stated. It is also projected to have a compound annual growth rate (CAGR) of 19 percent between 2012 and 2016--which is "significantly greater" than that of the United States, Japan, Canada or any western European market, it added.

"Developing markets such as the BRIIC countries and others promise large, as-yet-untapped growth potential. The performance of developing 'new growth' countries such as China is dramatic," said Jessica Kwee, research analyst at Canalys, in the report.

Delving deeper, Canalys stated China alone will account for 240 million smartphone units, or 29 percent of global shipments, this year. This meant China will extend its lead as the world's largest smartphone market over the U.S., which will contribute 125 million smartphone shipments.

The research firm also highlighted the Chinese smartphone market will be dominated by domestic vendors. "Domestic brands are rapidly moving their businesses toward smartphones and winning consumers with their competitively-priced devices. This will continue to put significant pressure on international vendors in 2013," noted Nicole Peng, research director of China at Canalys.

"With smartphones starting to penetrate lower tier Chinese cities, international brands lack real competitive advantage in those areas," she added.

China phonemakers to move abroad
This year will also see more Chinese vendors expand their smartphone businesses overseas, the research firm said. Lenovo, for instance, announced its plans for international expansion last September, joining the likes of other major Chinese vendors including Huawei, ZTE and TCL-Alcatel.

Smaller vendors such as Gionee, Yulong and Meizu, have also launched smartphones in Russia, India, Taiwan, and Southeast Asian and Latin American markets, it added.

According to Canalys research analyst Wang Jingwen, only a few Chinese smartphone makers have comprehensive or long-term international expansion plans in place though. "Their goals are straightforward: to grow economies of scale or fulfill production capacity and to increase profit margin as pricing pressure is lower in overseas markets."

But Wang acknowledged the "potential to be disruptive internationally" should now be extended to other Chinese vendors, and not just Huawei and ZTE.

Chinese vendors are not the only ones that need watching out for either. Canalys said top mobile vendors should also keep an eye out for domestic brands from Brazil, India, and Indonesia as these are making good headway in their respective home markets, too.

Topics: Smartphones, Mobility

Jamie Yap

About Jamie Yap

Jamie writes about technology, business and the most obvious intersection of the two that is software. Other variegated topics include--in one form or other--cloud, Web 2.0, apps, data, analytics, mobile, services, and the three Es: enterprises, executives and entrepreneurs. In a previous life, she was a writer covering a different but equally serious business called show business.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

0 comments
Log in or register to start the discussion