Worldwide smartphone shipments are expected to reach 1.45 billion units with a year-over-year growth rate of 0.6% in 2016 according to the latest forecast from the International Data Corporation (IDC). Although growth remains positive, it is down significantly from the 10.4% growth in 2015.
However, 4G smartphones are still expected to show double-digit uptake at 21.3% year-over-year growth globally for 2016, reaching 1.17 billion units, up from 967 million in 2015. Much of this growth is coming from emerging markets (Asia/Pacific excluding Japan, Latin America, Central and Eastern Europe, and Middle East and Africa), where only 61% of 2015 smartphone shipments were 4G-enabled compared to IDC’s 2016 projection of 77%, according to IDC. Mature markets (USA, Canada, Japan, and Western Europe) are further along the 4G adoption curve with 85% in 2015 and a projected 94% in 2016, respectively.
“It’s been a long slog for 4G uptake in many emerging markets as 4G data tariffs have long been very expensive compared to 3G, while 4G handsets themselves have also been relatively pricey across the board,” said Melissa Chau, associate research director with IDC’s Worldwide Quarterly Mobile Device Trackers. “We are quickly seeing this change in key growth markets like India where new operator Reliance Jio is aggressively trying to shake up the market by handing out free 4G SIM cards and launching own-branded low-cost 4G-enabled smartphones.”
The push to 4G is not only limited to smartphones, but will also provide a temporary boost to the shrinking feature phone market where 4G is a selling point in an even more cost-competitive space. In IDC’s short-term forecast, 4G feature phones will feature in emerging markets as well as in mature markets like the U.S. until smartphone prices drop further.
“As we approach the holiday quarter smartphone marketing has picked up significantly across almost all regions as expected,” said Ryan Reith, program vice president with IDC’s Worldwide Quarterly Mobile Device Trackers. “In North America and Western Europe, Google has been putting a significant amount of marketing dollars behind the new Pixel and Pixel XL, although early supply chain indications are that volumes are not at the point where Samsung or Apple should see a significant impact for Q4. Of course, as we head into 2017 this can change, but many eyes will be on Google to see how serious they are about pursuing the hardware play.”
