Emerging markets, led by India, drive smartphone sales growth

Overall sales of mobile phones contracted with all mature markets except Japan witnessing slow demand leading to a decline in sales of 4.9%, a Gartner report finds


Samsung continues to be the market leader with the biggest share of 22.3% and unit sales of about 78 million, according to a report by Gartner Inc. Photo: Reuters
Samsung continues to be the market leader with the biggest share of 22.3% and unit sales of about 78 million, according to a report by Gartner Inc. Photo: Reuters

New Delhi: Global smartphones sales weathered a slowdown in mature markets to grow by 4.3% to reach 344 million units in the second quarter of 2016, with emerging markets including India, Indonesia and Vietnam providing a strong push, according to a report by research firm Gartner released on Thursday. “India is contributing significantly to the worldwide growth in smartphone sales” Anshul Gupta, research director at Gartner, said.

All emerging markets, except Latin America, witnessed expansion, clocking 9.9% growth year-on-year, according to the report.

However, all mature markets, except Japan, witnessed slowing demand for smartphones, leading to a 4.9% decline year-on-year in sales in the second quarter. While China is included in the emerging markets category, it is fast becoming a mature market, Gupta added.

Smartphone shipments in India rose by 15% in the second quarter of 2016, according to a separate report by market research firm Counterpoint Research, released on 29 July.

India is the world’s second largest smartphone market, having overtaken the US in December 2015, and currently has more than 230 million users, according to a Nasscom report released on 17 August. This number is expected to grow to 702 million in 2020. The government has been pushing to bring rural areas into the Internet fold through its Digital India programme, under which it has started offering government services online.

All villages in India are expected to be connected through a National Optical Fibre Network or BharatNet by December 2018 under the government’s Digital India programme, which will provide them wi-fi and brodband connectivity.

Globally, Chinese phone makers continued to gain market share, led by companies like Huawei Technologies Co. Ltd, Oppo Electronics Corp. and Xiaomi Inc., according to the Gartner report.

Of the top five smartphone makers globally, Oppo exhibited the highest growth in the second quarter of 2016 at 129%, on the back of strong sales of its R9 handset in China and overseas markets. Its market share rose to 5.4% from 2.4% a year earlier.

Huawei’s market share rose to 8.9% in the second quarter, compared to 8% in the year earlier.

Apple, on the other hand, saw sales declining 7.7%, hurt by falling demand in North America and China.

“Demand for premium smartphones slowed in the second quarter of 2016 as consumers await new hardware launches in the second half of the year,” said Gupta.

Samsung continues to be the worldwide market leader with a share of 22.3% and unit sales of about 78 million in the quarter.

In India, Chinese brands accounted for almost 27% of the smartphone market, according to Counterpoint Research.

Chinese brands such as Oppo, Xiaomi and Vivo (BBK Communication Equipment) have been gaining traction with new product launches, aggressive marketing spends and continuing expansion of their channel presence.

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