China to pass U.S. in smartphone shipments in 2012

Jeremy Kirk
17 March, 2012
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China will surpass the U.S. in smartphone shipments this year, a title which the U.S. is never expected to regain, according to market figures released on Thursday by IDC.

The Asian giant is predicted to have a 20.7 percent share of the global market this year, edging out the U.S. share of 20.6 percent, IDC said. It is expected that 137 million smartphones will be sold in China this year. China began outselling the U.S. in smartphones in the second half of last year.

The United Kingdom is expected to take the number three spot at 4.5 percent, followed by India at 2.9 percent and Brazil at 2.3 percent.

IDC predicts a growing gap between China and the U.S. by 2016, as growth in smartphone adoption continues in developed markets but without the volume growth in countries such as India and Brazil.

By that year, IDC said China will hold 20.2 percent market share, followed by the U.S. at 15.3 percent; India, 9.3 percent; Brazil, 4.7 percent; and the UK at 3.7 percent.

Low-cost Android smartphones under US$200 were a key growth driver in China, IDC said. Prices will continue to become more affordable as chipset prices drop and the market sees increased competition.

China’s domestic vendors such as Huawei, ZTE and Lenovo will drive growth by supplying carriers with customised handsets, while Samsung and Nokia will drive volume with cheaper low-end smartphones, IDC said.

In India, domestic vendors Micromax, Spice, Karbonn and Lava will launch low-cost smartphones as they try to nudge customers up from feature phones. Carriers are also expected to “aggressively” roll out 3G networks and data plans in that country, IDC said.

Low inflation and a booming economy in Brazil have lifted consumers’ discretionary income and they are upgrading from feature phones to smartphones, which have dropped to less than US$300, IDC said.

Also key in Brazil has been the introduction of prepaid data plans, an important development since four out of five Brazilians have prepaid phone lines, IDC said. The number of mobile phones now exceeds the country’s population.

 

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