IDC predicts smartphone slump in 2014

US and EU losing interest

A new mobile phone forecast from IDC predicts that the European and US smartphone markets will become so saturated that growth will fall into single digits.

According to the IDC's Worldwide Quarterly Mobile Phone Tracker, worldwide smartphone shipments will slow to 8.3 per cent annual growth in 2017 and 6.2 per cent in 2018.

Annual smartphone volume in 2013 surpassed 1 billion units for the first time, accounting for 39.2 per cent growth over 2012.

Dropped calls

However, despite the high growth expected in many emerging markets, 2014 will mark the year smartphone growth drops more significantly than ever before.

In 2014 volumes are expected to be 1.2 billion, up from 1 billion in 2013, representing 19.3 per cent increase year-on-year.

Ryan Reith, Program Director with IDC's Worldwide Quarterly Mobile said that prices are too high to see a real boom within emerging markets, and that carriers and OEMs need to work together to bring prices down.

North America we see more than 200 million smartphones in active use.

Prices to fall

Reith said that 2014 will be an enormous transition year for the smartphone market. Not only will growth decline more than ever before, but prices will also fall.

Worldwide smartphone average selling price was $335 in 2013, and is expected to drop to $260 by 2018, according to Reith.

Ramon Llamas, Research Manager with IDC's Mobile Phone team added that last year there were 322.5 million smartphone units ship for under $150 and that number will continue to grow going forward.

"We've already seen numerous smartphone announcements targeting this priceband this year, with some as low as $25," he said.

Android rules

The report said that Android will maintain its reign as the leading operating system throughout IDC's forecast. With a strong presence within emerging markets and attainable price points for both vendors and customers,

While iOS will remain the clear number 2 platform behind Android, Apple's obsession at shooting for the high end of the market will stand against it.

iOS has little chance from earning much cash within emerging markets, but sales in mature markets could offset much of the difference.

Microsoft survives

Windows Phone stands to grow the fastest among the leading smartphone operating systems, with continued support from Nokia as well as the addition of nine new Windows Phone partners, IDC said.