ChannelLife NZ - Android to remain dominant OS as mobile phone market slows

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Android to remain dominant OS as mobile phone market slows

Android’s majority share over operating systems on mobile phones isn’t going anywhere, according to new research from IDC, who says its 81% share of the market this year is set to continue until 2019.

The industry analyst firm says that despite Apple’s continued success with its variants of the iPhone, Apple will be challenged to take Android share, as markets with the biggest opportunity are extremely price sensitive. A fact IDC says will not change.

“Even if Apple were to introduce another low-cost iPhone (e.g., ‘C’ version), IDC believes the price will struggle to compete with Android OEMs that are focused on portfolios aimed at price points of $200 and less,” the company explains.

“This isn't to suggest that Apple's success with the iPhone won't continue, and IDC believes its efforts to maintain significantly higher margins compared to its competitors are much more valuable than chasing share.”

IDC says Android shipments globally are expected to grow from 1.06 billion in 2014 to 1.54 billion in 2019, while iOS shipments will grow from 192.7 million in 2014 to 269.6 million in 2019.

Additionally, IDC's view that Microsoft/Windows Phone will remain a marginal challenger at best has not changed. 

According to IDC’s latest mobile phone forecast, smartphone shipments are expected to grow 10.4% in 2015 to 1.44 billion units. This is lower than IDC's previos smartphone forecast of 11.3% year-over-year growth in 2015.

IDC says it expects to see a noticeable slowdown in smartphone shipments in 2015 as China joins North America and Western Europe in a more mature growth pattern.

However, the analyst firm says steadily falling average selling prices will fuel steady growth through the end of the forecast period, with global shipments reaching 1.9 billion units in 2019.

According to the forecast, China remains the focal point of the global smartphone market in 2015, although the results haven't been as positive as in previous years.

“As the largest market for smartphones – China consumed 32.3% of all new smartphone shipments in 2014 – its importance remains great even if its growth has begun to slow,” IDC explains.

Shipments are forecast to grow just 1.2% year over year in 2015, which is down from 19.7% in 2014.

IDC says China will remain the largest market for smartphone volumes throughout the forecast period. However, its share of the overall market is expected to drop to 23.1% in 2019 as high-growth markets like India continue to expand.

"China clearly remains a very important market. However, the focus will be more on exports than consumption as domestic growth slows significantly," explains Ryan Reith, programme director with IDC's Worldwide Quarterly Mobile Phone Tracker. 

"India has captured a lot of the attention that China previously received and it's now the market with the most potential upside,” he says.

“The interesting thing to watch will be the possibility of manufacturing moving from China and Vietnam over to India. We've begun to see this move as a means to cut costs and capitalise on financial benefits associated with localised India manufacturing.”

Reith adds, “It is the local vendors like Micromax, Lava, and Intex that will feel the most pressure from international competition within its market."

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