After two consecutive quarters of growth, IDC forecasts that in the near future, the smartphone market will continue growing. In this sense, the Android devices will become even more popular. This will also make the 5G phones cost less, becoming available in more markets.
IDC’s global quarterly smartphone tracking shows that in 2021, smartphone shipments are expected to reach 1.38 billion units, an increase of 7.7% over 2020. This trend should continue until 2022, with a year-on-year growth of 3.8% and shipments totaling 1.43 billion units.
5G Android Devices Will Become Available To Larger Groups
Many markets around the world that have deployed 5G networks are continuing to migrate to 5G equipment. But emerging markets, after the impact of the epidemic, have shown strong demand for low- and mid-range 4G smartphones. Looking ahead, IDC predicts that low single-digit growth will continue until 2025. Also, the market will have a five-year compound annual growth rate (CAGR) of 3.7%.
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In addition, IDC also pointed out that the supply chain continues to vigorously promote 5G, and the average unit price continues to decline as a result. IDC predicts that the average selling price of 5G Android devices in 2021 will drop by 12% year-on-year to US$456, and will fall below US$400 in 2022.
“Smartphones are seeing competition for consumer spending from adjacent markets like PCs, tablets, TVs, and smart home devices, yet that hasn’t slowed the market’s path to recovery,” said Ryan Reith, program vice president with IDC’s Worldwide Mobile Device Trackers. “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 and then below $400 in 2022. Apple will continue to feel price pressure.”
Why This Happening
IDC also says that the 7.7% growth will feel like an impressive market turnaround. But we must keep in mind that we are rebounding from one of the most challenging years on record. “2021 will represent the largest year-over-year growth the market has witnessed since 2015, as the shift towards 5G across all price tiers continues to accelerate. The 5G shift will also deliver peak smartphone ASPs in 2021 ($376, 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.”