The accelerating investments in digital developments across the globe are proliferating the demand for smartphones.
The global smartphone market was valued at US$ 724.9 Bn in 2020 is expected to reach US$ 1,425.6 Bn by 2027, with a growing CAGR of 11.5% during the forecast period (2021-2027).
The smartphone penetration is rising across the emerging economies including Brazil, India, China, South Africa, Mexico, Indonesia, Poland, and Bangladesh among others. Emerging economies contribute to approximately 59% of the global smartphone shipment and the growth rate is the fastest among these markets. The factors such as internet penetration in the emerging economies are still below 50% and provide enormous opportunities for further growth. Smartphones are widely used by users from emerging economies to access the internet which is anticipated to increase smartphone penetration thereby driving the market revenue.
Furthermore, 5G will drive future innovation and economic growth in the smartphone industry thereby delivering greater societal benefit compared to the previous smartphone generation. 5G will further thrive on the new digital services and business models. The advancement in Artificial Intelligence (AI) and Internet of Things (IoT) and 5G are developing in parallel, which will have a positive impact on the market. It is anticipated that 5G will account for 20% of the global connections by 2025 and stronger primarily across North America, Europe, and developed Asia. To captivate the new market opportunities provided by new technology innovation, the key industry leaders are developing products and devices.
Among the various electronic devices, the smartphone is the most demanded product and is primarily driven by the increasing consumer disposable income and changing lifestyle. The rising disposable income is increasing consumer spending on networking, media, and entertainment lead to a higher potential sale of smartphones. The adoption rate for smartphones is very high among the urban population and hence the demand is higher in the developed countries. However, people across developing countries are increasingly adopting smartphones and are looking for price-sensitive options. To address the demand from emerging economies the smartphone manufacturers are introducing budget phones.
In terms of geography, North America held a significant market share in 2020. In North America, Apple held the largest market share followed by Samsung. In the U.S., Apple witnessed a year-on-year growth rate of 14% whereas Samsung grew by 5% year-on-year in 2020. The U.S. accounted for the largest share in North America smartphone market followed by Canada. North America is an early adopter of innovations and new technologies and the smartphone manufacturers in the region are making constant investments to offer improved solutions to the consumers. The pandemic impacted the smartphone sales in the region with the U.S. witnessing a decline of 6% year-on-year. The leading players are mitigating the losses incurred during the pandemic with new product launches. The COVID-19 pandemic has increased the popularity of smartphones in Canada owing to rising consumer’s reliance on smartphones during the lockdown. The region is anticipated to witness a stable growth rate in the smartphone industry during the forecast period.
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