Original URL: http://www.theregister.co.uk/2012/03/16/china_brazil_india_smartphones/

China ready to slap down US in smartphone wars

No turning back after 2012 as Brazil and India close in on UK

By Phil Muncaster

Posted in Mobile, 16th March 2012 03:21 GMT

In another sign of the shifting balance of power on the global technology stage, China is set to steam ahead of the US to become the leading market for smartphone shipments in 2012, while the UK will be overtaken by India and Brazil by 2016, according to analyst IDC.

The firm’s latest Worldwide Quarterly Mobile Phone Tracker predicted that China’s smartphone market share would rise from 18.2 per cent in 2011 to 20.7 per cent this year, while that of the US would fall from 21.3 per cent to 20.6 per cent over the same period.

The UK was a distant third globally in 2011 with 5.3 per cent but despite experiencing continued growth in the space, will not be able to keep up with the kind of volumes being shipped in emerging markets.

IDC predicted the UK would drop into fifth place by 2016 with a share of 3.7 perc cent, behind Brazil (4.7 per cent) and India (9.3 per cent).

"Due to their sheer size, strong demand, and healthy replacement rates, emerging markets are quickly becoming the engines of the worldwide smartphone market," said IDC analyst Ramon Llamas, in a prepared statement.

"Users in emerging markets seek more than simple voice telephony, and smartphones offer the ideal platform for mobile entertainment, social networking, and business usage as seen in developed markets."

His colleague, Wong Teck Zhung, added rather ominously that once China assumes the number one spot in worldwide smartphone shipments “there will be no turning back”. The country is expected to have hit the one billion mobile phone users in the first quarter of 2012.

The main growth in smartphone sales in China will come from the lower end, as a range of vendors including Huawei, ZTE and Lenovo bulk out their offerings in the sub-$200 (£127) space.

The stats tally with the growth in the market which analyst firm Gartner is seeing, although it is clear that the majority of Chinese users are still on fairly basic 2G feature phones and therefore use their devices for little more than voice calls and texting.

Gartner analyst Sandy Shen told The Reg recently that while smartphone shipments would rise from around 20 per cent of the domestic Chinese market to 40 per cent in 2015, installed base would be much lower – rising from less than 10 per cent to around 20 per cent over the same period.

India, meanwhile, has already shown itself to be a powerhouse in the mobile market with new Census stats from the government revealing that more households in the country have a mobile phone than an inside toilet.

Once again the main area of growth in smartphones will be at the budget end, with domestic vendors including Micromax, Spice, Karbonn and Lava having already launched low-cost devices in a bid to move their customers off basic feature phones, said IDC.

The analyst added that in Brazil, mobile phone subscriptions have exceeded the country’s population, with handsets available in the sub-$300 bracket and prepaid data plans proving popular. ®