China's booming smartphone growth starts to fizzle

Growth in the Chinese smartphone market will fall to single digits next year, according to IDC

China's appetite for smartphones is starting to reach its limit, with growth in the once booming market expected to reach single digit levels next year.

The country ranks as the world biggest market for the devices, brought on by its giant population and scores of local vendors peddling cheap Android handsets. Demand in the market was so high that in 2013 smartphone shipments to the country were up 64 percent year over year, according to research firm IDC.

But the growth has cooled down in 2014, with IDC's projection putting the year-over-year growth at 20 percent. And future growth will slow even further."Over the next few years, we expect it to be in single digits," said IDC analyst Kiranjeet Kaur on Tuesday.

Smartphone vendors are still shipping huge quantities to the country, but the market has been mostly tapped, she added. In this year's third quarter, China's smartphone shipments reached 105 million, up by only 1 million units from the previous quarter.

It hasn't helped that the country's mobile carriers have recently cut device subsidies, further tempering smartphone sales, Kaur said.

Unlike the U.S., which only has a handful of vendors, including Samsung Electronics and Apple, with a sizeable presence in the market, China has dozens of different players, both small and large, all fighting for a piece of the pie. About 87 percent of the shipments to the country come from domestic vendors such as networking gear supplier Huawei Technologies, PC maker Lenovo, and fast-rising Xiaomi, according to IDC analyst Kitty Fok.

China's smartphone market is so saturated that earlier this month Lenovo, one of the country's biggest smartphone vendors, said the era of hyper-growth in the market has ended.

"If you want to win you have to find new growth areas," Lenovo's CEO said at the time.

To keep on driving sales, Chinese smartphone vendors are moving outside their home market and into regions such as Southeast Asia. A few of these players including Lenovo and China's Oppo have been gradually growing in countries such as Indonesia and the Philippines, by selling phones for US$100 to $200, said IDC's Kaur.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags smartphonesAndroidconsumer electronicsHuawei TechnologiesXiaomi

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Brand Post

Imou: At home with security

Modern living is all about functionality and security for everybody from the very young to the very old. With Imou anybody can enjoy smart life – the solution is at their fingertips.

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Tom Pope

Dynabook Portégé X30L-G

Ultimately this laptop has achieved everything I would hope for in a laptop for work, while fitting that into a form factor and weight that is remarkable.

Tom Sellers

MSI P65

This smart laptop was enjoyable to use and great to work on – creating content was super simple.

Lolita Wang

MSI GT76

It really doesn’t get more “gaming laptop” than this.

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?