This year will see the largest year-over-year smartphone market growth since 2015, as the shift towards 5G across all price tiers continues to accelerate, a new report says.
According to the IDC Worldwide Quarterly Mobile Phone Tracker, shipments of smartphones are forecast to reach 1.38 billion units in 2021, an increase of 7.7% over 2020.
This trend, it says, is expected to continue into 2022, when year-over-year growth will be 3.8%, with shipments totalling 1.43 billion.
“The smartphone market returned to growth during the holiday quarter last year and since then we’ve only seen production from top suppliers ramp up.
“There continues to be a strong supply-side push toward 5G, and price points continue to drop as a result. IDC expects average selling prices (ASPs) for 5G Android devices to drop 12% year-over-year in 2021 to $456 (R6 300) and then below $400 (R5 500) in 2022,” says Ryan Reith, programme vice-president with IDC’s Worldwide Mobile Device Trackers.
IDC says with 5G shipments expected to grow nearly 130% in 2021, almost all regions outside of China will see triple-digit growth by the end of this year.
In terms of market share, the company says, China will lead the way with nearly 50% share of 5G shipments in 2021, while the US will follow with a 16% share.
Other significant markets such as Western Europe and Asia/Pacific (excluding China and Japan) will combine for a 23.1% share of the worldwide 5G market by the end of 2021.
“The 5G shift will also deliver peak smartphone ASPs in 2021 of $376 (R5 100) − up 9.7% year-over-year − when compared to the remainder of the forecast period, as costly 5G devices continue to replace LTE devices, which are also starting to drop in price, down 27% in 2021,” says Anthony Scarsella, research manager with IDC’s Worldwide Mobile Device Trackers.
For the emerging markets, the report says, there is strong demand for mid-range and low-end 4G phones following last year’s pandemic slowdown.
Looking ahead, IDC expects low single-digit growth to continue through 2025 with a five-year compound annual growth rate of 3.7%.
The company also notes the global semiconductor shortage remains a concern for many industries, including the smartphone market. However, IDC says, the impact has been far less than in other markets, like automotive, PC and various consumer tech categories.
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