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Smartphone makers ‘may reconsider’ price and spec as costs rise and growth slows

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Smartphone market growth will slow to just 2.8 per cent in 2018 due to lower demand, fewer replacement purchases and saturation in the Chinese market, according to research from TrendForce.

It predicts that global production will reach 1.5 billion units having previously expected a growth rate of five per cent.

Analysts suggest intense competition, combined with the ongoing rise in the cost of components, will mean vendors will have to consider the prices and specifications of their products.

Mobile phone sales

The main features that phone makers hope will act as a catalyst for expansion are all screen technology, dual cameras and biometrics. Apple will focus on facial recognition with FaceID, while Samsung will use Iris scanning as other Android vendors stick with fingerprint scanners due to technical restraints.

Exacerbating these pressures is the fact that some manufacturers have excessive inventory after all-screen handsets launched during the second half of 2017 failed to offset lower-than-expected sales during the first six months of the year.

Indeed, of all vendors, Apple and Nokia are the only international vendors with a “clear future of growth” in 2018, says TrendForce.

Samsung will continue to be the world’s largest manufacturer with 20.3 per cent of the market and shipments of 300 million. However this is a still a decrease of five percent year on year.

It is predicted that Apple will enjoy six per cent growth and 15.7 per cent share thanks to new models with FaceID, all screens and more storage, while Huawei will remain third with 173 million units and an 11.6 percent share.

Chinese manufacturers’ growth is anticipated to fall as they look for new markets outside their homeland, but Xiaomi could usurp Oppo in fourth place.

But it is Nokia that could buck the trend. Despite its share being significantly smaller than the aforementioned players, it could thrive in the mid to low-end markets where cost pressures are expected to be at their most severe.

Indeed, it could increase shipments by 70 percent and exceed 20 million units.

Source Link: Smartphone makers ‘may reconsider’ price and spec as costs rise and growth slows

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