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Smartphone growth? Not in Q1, says IDC

Phone-fondlers fondle fave phones for longer, spoiling upgrade cycle

Prospects for handset-makers just got worse, with the smartphone market recording its worst quarterly growth ever.

Remember how at the end of March, Gartner predicted a mere seven per cent smartphone growth for 2016, the first time the market hadn't managed double-digit growth?

That forecast is starting to look like rose-coloured-glasses optimism, with IDC saying the first quarter 2016 didn't even manage single-digit growth.

IDC says its Quarterly Mobile Phone Tracker data shows year-on-year Q1 smartmobe shipments were 334.9 million, a mere 600,000 units higher than Q1 2015's 334.4 million – in other words, well within the margin of error.

Apple and Samsung declined, IDC says, developed markets are saturated, and China has challenges all its own. Announcing its first year-on-year revenue decline in a long time, Apple noted that greater China had fallen by 26 per cent.

IDC notes that China's smartphone market piled on 62.5 per cent shipment growth back in 2013, but in 2015, growth was only 2.5 per cent.

The Middle Kingdom is a threat in another way: local brands are scrambling for domination in the home market. OPPO and vivo – pretty much unknown names anywhere but China – displaced Lenovo and Xiaomi in fourth and fifth place.

IDC's Melissa Chau reckons OPPO, vivo, and Huawei are the brands looking at the best 2016.

Top Five Smartphone Vendors, Shipments, Market Share and Year-Over-Year Growth, Q1 2016 Preliminary Data (Units in Millions)          
Vendor Q1 2016 Volume (million) Q1 2016 Share Q1 2015 Volume (million) Q1 2015 Share Y-o-Y change
Samsung 81.9 24.5% 82.4 24.6% -0.6%
Apple 51.2 15.3% 61.2 18.3% -16.3%
Huawei 27.5 8.2% 17.4 5.2% 58.4%
OPPO 18.5 5.5% 7.3 2.2% 153.2%
vivo 14.3 4.3% 6.4 1.9% 123.8%
Others 141.5 42.3% 159.8 47.8% -11.4%
TOTAL 334.9 100.0% 334.4 100.0% 0.2%

Source: Source: IDC Worldwide Quarterly Mobile Phone Tracker, April 27, 2016

IDC thinks Samsung is on a winner with the S6 and S7, in spite of its year-on-year decline. It's less enthusiastic about Apple's iPhone SE, which at US$399 “faces equally-powerful lower-priced devices from competitors”.

Huawei has a good chance to compete in the global market with its P9-with-Leica-optics, the Mate series, and the Nexus 6.

However, the vendor battle is likely to be a scramble for share in a pretty static market. ®

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