China to be biggest smartphone market in 2012

Dylan Bushell-Embling
16 Mar 2012

China is expected to become the world's biggest smartphone market in 2012, overtaking the US by shipments, IDC has predicted.

The research firm noted that China already outstripped the US by smartphone shipments for two consecutive quarters in 2H11, and said it expects China to only increase its lead in the years ahead.

IDC predicts that China will have a 20.7% share of the smartphone market this year, compared to 20.6% for the US. But by 2016, this gap is expected to widen, with China holding a 20.2% share of the market and the USA having 15.3%.

India will be another major smartphone market, growing from ninth place by shipments in 2011 to seventh place by 2012, and third behind China and the US by 2016.

In both China and India, low-cost smartphones will be a key market driver. Sub-$200 Android smartphones are a hot commodity in China, while in India local players such as Micromax, Spice, Karbonn and Lava have already launched low-cost smartphones domestically.

The swelling sales in China and India underscore the growing importance of emerging markets to the smartphone sector, IDC senior research analyst Ramon Llamas said.

“Due to their sheer size, strong demand, and healthy replacement rates, emerging markets are quickly becoming the engines of the worldwide smartphone market,” he said.

But he added that emerging markets create unique complications for the industry.

“Smartphones still represent a significant investment for consumers in many countries,” he said. “This fact was acknowledged by a number of industry executives at the recent Mobile World Congress in Barcelona, who stressed the need for low-cost devices – as low as sub-US$50 – to spur widespread adoption.”

The cost of a monthly phone plan is another barrier to adoption, Llamas said.

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