Have we passed the peak of the smartphone era? – Have We Passed the Peak of the Smartphone Era?

Published on: February 15, 2019 / Update from: February 15, 2019 - Author: Konrad Wolfenstein

According to the latest estimates from market research firm IDC, global smartphone shipments reached 375 million units in the fourth quarter of 2018, marking the fifth consecutive quarter of negative growth for the smartphone market. For all of 2018, smartphone shipments fell 4.1 percent to 1.4 billion units, making it the worst year ever in terms of growth.

With smartphone penetration reaching saturation levels in many regions and true innovation becoming rarer and less obvious to the average user, it was only a matter of time before the market reached this point, namely the question of whether it would just go from here will still go downhill. Or in other words: Have we already passed the peak of the smartphone era?

"Globally, the smartphone market is a mess right now," says Ryan Reith, vice president at IDC, citing longer replacement cycles, high penetration rates and consumer frustration with rising prices as some of the factors contributing to the market's current weakness. This weakness is expected to continue into 2019 as vendors continue to face challenging conditions, particularly in China, the world's largest smartphone market. The impending arrival of 5G devices provides a glimmer of hope for the industry, but more expensive hardware could push prices even higher and potentially limit the positive impact of 5G's arrival.

According to latest estimates from market research firm IDC, global smartphone shipments amounted to 375 million units in the fourth quarter of 2018, marking the fifth straight quarter of negative growth for the smartphone market. For the entirety of 2018, smartphone shipments declined by 4.1 percent to 1.4 billion units, making it the worst year ever in terms of shipment growth.

With smartphone penetration reaching saturation levels in many regions and real innovations becoming rarer and less obvious to the average user, it was only a matter of time before the market reached this point, the question being whether things will only go downhill from here. Or in other words: have we passed the peak of the smartphone era yet?

“Globally the smartphone market is a mess right now,” Ryan Reith, vice president at IDC, says, citing longer replacement cycles, high penetration levels and consumer frustration with rising prices as some of the factors contributing to the market's current weakness. That weakness will likely carry on through 2019, as vendors continue to face challenging conditions, especially in China, the world's largest smartphone market. The imminent arrival of 5G devices does provide a glimmer of hope for the industry, but the more expensive hardware could drive up prices even further, potentially limiting the positive effect of 5G's arrival.

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