Smartphone shipments fall for first time

The number of smartphones shipped worldwide has fallen for the first time in the history of the market. 

This is according to the latest figures from market research and analysis firm Canalys, which specified that 321 million units were shipped in the first three months of the year. 

It was noted that this is a significant decline compared with the corresponding figure for the first quarter of 2015, when 324 million units were shipped. Apple and Samsung – the world's biggest vendors – both posted shipment declines, with the former being the worst hit by the trend. 

Indeed, smartphone shipments actually increased by five per cent for the first quarter when the figures from Apple and Samsung are excluded. This is despite the fact that some other big name international vendors outside the top five, such as LG, Lenovo and TCL-Alcatel, also fared poorly. Additionally, Sony's figures plummeted by around 57 per cent. 

Canalys attributed the trend to a range of factors, including Apple's inability to repeat its major success with the launch of the iPhone 6. This iteration of the device was launched back in 2014. It prompted a major upgrade cycle among Apple's dedicated user base, thanks to the larger display it offered over its predecessors. 

Among all the major vendors, Apple experienced the most marked drop, shipping 11 million fewer units in Q1 2016 than it did 12 months previously – a fall of 16 per cent. 

Canalys indicated that the upgrades Apple offered with the iPhone 6 may be symptomatic of a wider industry trend, in that the updates are becoming more modest. Product innovation appears to be slowing in the premium smartphone sector, with consumers responding by retaining handsets for longer before being attracted to a new upgrade. 

This is compounded by subsidies being reduced in major markets such as Western Europe and the US, meaning contract tariffs are higher. 

Conversely, mid-range devices are benefitting from significant improvements in specification and quality, so the upgrade and replacement cycle is also becoming longer in high-growth markets. This is particularly the case where flagship models such as the Samsung Galaxy S7 and the Apple iPhone 6s are beyond the reach of consumers in these markets. 

Vice-president of analysis at Canalys Rachel Lashford acknowledged that this could present smartphone manufactures with some difficulties. “Conditions are challenging for many vendors and we expect to see a consolidation of the smartphone market in coming quarters.”

She said that against this backdrop, firms operating in China could be well placed to expand into new territories and offer smartphones to other countries. 

“There are bright spots, however, such as Huawei, Oppo and Vivo, which all increased shipments dramatically,” Ms Lashford commented. 

“These vendors are expanding beyond China, nurturing their channels, spending on marketing and making their differentiators around technology and positioning abundantly clear to consumers.”ADNFCR-2155-ID-801818310-ADNFCR

Written by Mazuma

Mazuma Mobile is the UK's most trusted mobile phone recycling service.

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