Report: Smartphone Growth is Flat in 2016

Posted on November 30, 2016 by Paul Thurrott in Android, iOS, Mobile, Windows Phones with 21 Comments

Report: Smartphone Growth is Flat in 2016

The market researchers at IDC now say that smartphone sales growth will be almost non-existent, at 0.6 percent, for calendar year 2016. Devices makers will sell 1.445 billion smartphones this year, IDC states.

“Although growth remains positive, it is down significantly from the 10.4 percent growth in 2015,” the IDC report notes. But as with the similarly stagnant PC market, there are some bright spots, in this case 4G-capable phones. “4G smartphones are still expected to show double-digit uptake at 21.3 percent year-over-year growth globally for 2016, reaching 1.17 billion units.”

As you might imagine, Android remains dominant, with sales of 1.229 billion units, up 5.2 percent for the year. Android now controls 85 percent of the market, according to IDC.

Apple’s iOS remains in second place, having sold 206.1 million units, good for 14.3 percent of the market. But iOS’s market share continues to fall: Apple conceded another 11 percent, year-over-year.

Windows phone, on the verge of getting knocked into the “Other” category, is a disaster: IDC expects just 6.1 million Windows phones to be sold in 2016, down 79.1 percent year-over-year, and good for just 0.4 percent of the market. IDC notes that Windows phone was “a non-story in 2016” and that the platform has “a tough road ahead,” barring some miracle.

Looking ahead to 2020, IDC anticipates that Google will retain its stranglehold on the market, with 85.6 percent share. Apple iOS will remain at number two, with 14.2 percent share. And Windows phone will collapse further to just 0.1 percent of the market. The good news is that overall smartphone sales should be up by 4.8 percent by that time.

IDC, of course, is only one of a handful of firms that reports smartphone market share. When Gartner and other analysts provide their own data, I’ll prepare a Health of Tech report for the smartphone industry, similar to the preview report for the PC industry.

 

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Comments (24)

24 responses to “Report: Smartphone Growth is Flat in 2016”

  1. 1792

    This shows the success of the Microsoft Windowsphone strategy. Reduce costs (by stop making phones), rely on OEMs and abandon the consumer market. The strategy has been rewarded with almost zero costs and still 6.1 million sales.

    Making further remarks showing Microsoft have no interest in their own mobile platform will deliver even more cost savings. 

  2. 5496

    Didn't IDC last year say that smartwatches will sell billions? 

    But they are not selling as much as they said.

    They also said tablet sales would be more then what it is.

    So I wouldn't trust them.

    Isn't all phones 4g by now?

  3. 5394

    The high cost of iPhone and its slowness in adopting some nifty hardware in Android phones will hurt it. Nonetheless Windows Phone is another beast of unresolved technology. Microsoft has so many DOA and half-baked technologies in Windows 10 that its comical that it is trying. Just stop (or at least stop making me laugh).

  4. 5498

    Isn't that the same folks who predicted that windows phone would surpass iPhone by 2015?  What happened there?  The only thing IDC is good for is telling us the obvious, anyone who follow this thing/market closely can tell you all the stuff IDC try to present/sell as great research.  They have been wrong just about every time they try to tell us the non obvious stuff.

  5. 442

    Most believe Apple's falling share is due to lackluster phones.  I think it's more due to stupidity in design.  If they'd go more mainstream, rather than trying too hard to innovate they might not loose so many customers.  Innovation on existing products has always shown to be best done in small doses.  Large changes often alienate people.

  6. 3272

    .1 %? They clearly aren't taking into account MS's grand strategy or retrenching. ?

  7. 643

    I think that the fact that phones have trickled down all the way to, at least, 6th grade level, they can't really have growth until people start reproducing more.  Phone innovation has reached a plateau so upgrading every year is no longer an incentive.

    It is like Video Game cards, at the beginning you had to have the latest one because the difference in quality and speed was high from one generation to the other, now you can get away with a new video card every few years.

    It took the Desktop world almost three decades to reach this plateau, it just happened much faster with phones.

  8. 217

    Smartphones are getting better, so much so that here in the US people are realizing they don't actually need an upgrade every year or even 2 years, they are holding onto their phones for a longer period of time (see: iPad growth issues). Add to the fact people in the rest of the world are starting to get them as well, so growth is obviously going to start declining.

    • 1959

      In reply to dcdevito:

      I'm not sure I'd attribute it to "getting better". I think that it's more that they aren't getting better. Why upgrade for tiny incremental upgrades? I think a healthy dose of fatigue probably plays a role as well. Switching phones, even within the same ecosystem, is tedious.

  9. 5234

    The millennials are actually seeing that they have to tighten their belts and do work to make a living instead of throwing the Western world further into debt.

    Ironically, tech jobs are in high demand.  The reason: millennials think they're entitled to more than what companies are willing to pay.

  10. 165

    0.4% is a small number.

    6.1 million sounds big if you don't look at the 1.2 billion for Android.

    Still, if you sell an app for 1.29, and you keep $1.00 of each sale, and you sell to 2% of the 6.1 million users, that's way more money than I make in a year.

    How much effort is required to port an app to Windows?

    • 1353

      In reply to RonH:

      The simple maths seems to imply there is still a market here but it does not work out that way. The majority of these 6.1 million phones are not in the US, but rather in poorer developing countries. Unless you app is really essential they are not going to spend even $1 on it.

    • 1377

      In reply to RonH:

      Picky: your percentage arithmetic needs work. 30% off the top from 1.29 would leave $0.90. 2% of 6.1m is 122K, so sales would be just under $110K. If that's way more than you make in a year, what are you doing spending money on a Thurrott premium account?

  11. 5496

    There's no new innovations in phones right now.

    Yeah, you can put in a better CPU, GPU, RAM, camera, but what does that mean for the average consumer?

    • 1377

      In reply to lordbaal1:

      Yup, so phones have almost caught up with PCs on the downslope.

      Perhaps we've reached the point where hardware innovation will need scientific and technological breakthroughs to achieve substantial future growth.

  12. 5592

    Amusing that the IDC "prediction" says that Apple, who has been losing double digit share all across iOS for a couple of years now (even they say down 11% this year) will amazingly stop hemorrhaging share and only lose 0.1% share over the next 3 years. That's a pretty incredible turnaround for a company that hasn't had a breakthrough feature in several versions.

    I guess the public has just been holding off until they could get rid of the headphone jack.

  13. 5510

    Well, it happens. It's the laws of economics. Plus we are only talking about rate of growth here.

    WOW...Windows Phone is now at the 0%. We can probably single these people out and actually know them by name. LOL.

    They are probably all Thurrot.com Premium Users. LOL.

  14. 7102

    I guess some brands maybe will dissapear in the android world. I think some of the "old" Taiwanese brands will have a hard time to last (HTC or Asus)

    You got a lot for the money with OnePlus, or the rising Vernee. But time will tell what will happend.

    Nokia will return to. 

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