The number of smartphones shipped in Europe fell by 6.3 per cent during the first quarter of 2018 – the largest ever drop in a single quarter – as smartphone fatigue enveloped Western Europe.
Shipments across the continent reached 46 million, according to figures from Canalys, but Western Europe fell by 13.9 per cent to 30.1 million. Meanwhile, a 25.4 per cent increase in the Russian market helped sales in Eastern Europe rise by 12.3 per cent to 15.9 million.
However analysts claim this growth is not enough to offset saturation in more developed markets. For example, sales were down 29.5 per cent in the UK, 23.2 per cent in France and 16.7 per cent in Germany.
“This is a new era for smartphones in Europe,” said Ben Stanton, Analyst at Canalys. “We are moving from a growth era to a cyclical era. This presents a brand-new challenge to the incumbents, and we expect several smaller brands to leave the market in the coming years.”
Samsung and Apple are still the world’s two biggest manufacturers and although shipments are falling, the average value of each device sold is increasing thanks to expensive flagships like the Samsung Galaxy S9 and iPhone X.
Huawei maintains its grip on third place, increasing shipments by 38.6 per cent, while Xiaomi recording a growth rate of 999 per cent to secure 5.3 per cent of the market and 2.4 million sales.
The company has just reached an agreement with CK Hutchison, the parent of mobile operator Three, to stock its devices, meaning these figures are set to increase in the coming quarters. Analysts expect Xiaomi, and fifth-placed HMD Global, to continue their momentum in Europe.
“Xiaomi is working closely with distributors, such as Ingram Micro and ABC Data, to drive products into retail stores,” explained Lucio Chen, Research Analyst. “HMD has taken a different approach, using its operator relationships on the feature phone side to get its new smartphones ranged across Europe. But both Xiaomi and HMD Global have the benefit of being privately owned.
“As Xiaomi has shown, private companies have an incentive to operate at a substantial net loss to drive smartphone shipments, boosting market capitalization before IPO. But this is not sustainable in the long term, and both Xiaomi and HMD Global will eventually have to shift their revenue and cost structures, as the top three have now done, toward profitability.”
Canalys also noted that more high-end specifications are filtering down to mid-range handsets, with more advanced cameras and larger screens becoming more commonplace. Indeed, the number of devices shipped with more than 4GB of RAM is up 82.7 per cent. Dual SIM handsets are expected to rise in popularity, with Samsung bringing more of them to Europe in 2018.
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Steve McCaskill is TechRadar Pro's resident mobile industry expert, covering all aspects of the UK and global news, from operators to service providers and everything in between. He is a former editor of Silicon UK and journalist with over a decade's experience in the technology industry, writing about technology, in particular, telecoms, mobile and sports tech, sports, video games and media.