By the end of the decade, there will be 9 billion mobile connections across the globe. And while 3 billion will be data terminals, dongles, routers and feature phones, the other two thirds will be smartphone handsets, according to the GSMA.
The organization that represents the interests of the world’s mobile operators claims that the smartphone market is poised for huge growth over the next six years — there are currently 2 billion handsets in active use — and that demand is being driven by consumers in emerging countries.
According to the GSMA’s latest study, “Smartphone forecasts and assumptions, 2007-2020,” published Thursday, developing economies overtook mature markets such as the US and western Europe in 2011.
“In the hands of consumers, these devices are improving living standards and changing lives, especially in developing markets, while contributing to growing economies by stimulating entrepreneurship. As the industry evolves, smartphones are becoming lifestyle hubs that are creating opportunities for mobile industry players in vertical markets such as financial services, healthcare, home automation and transport,” said Hyunmi Yang, Chief Strategy Officer at the GSMA.
Asia Pacific already accounts for half of global smartphone connections yet smartphone penetration is still below 40 % in the region, even when China’s 629 million smartphone connections are factored in. By the end of the decade, emerging countries will account for four in five smartphone connections, as regions like North America and Europe hit the 70-80 % mark and growth drops off.
The fastest growing region is expected to be sub-Saharan Africa. When figures are based on smartphone adoption as a percentage of all mobile connections, the region currently has the lowest adoption rate (15%) in the world. However, the wider availability of affordable handsets and the roll-out of networks are expected to have a huge impact.
The GSMA claims that the main factors driving smartphone adoption in emerging countries is falling prices. The price difference between feature phones and smartphones is getting smaller and smaller and $50 smartphones are now a reality.
In mature markets, operator subsidies and the roll-out of 4G networks is helping to maintain growth in the premium end of the market, while more intelligent, individualized data plans are also helping to win consumers over from feature phones in all markets.
“As the study released today shows, smartphones will be the driving force of mobile industry growth over the next six years, with one billion new smartphone connections expected over the next 18 months alone,” said Yang