Global smartphone growth to fall sharply in 2014 - IDC

SAN FRANCISCO Wed Feb 26, 2014 11:38pm IST

The new Samsung Galaxy S5 smartphone (L), Gear 2 smartwatch (C) and Gear Fit fitness band are displayed at the Mobile World Congress in Barcelona February 23, 2014. REUTERS/Albert Gea

The new Samsung Galaxy S5 smartphone (L), Gear 2 smartwatch (C) and Gear Fit fitness band are displayed at the Mobile World Congress in Barcelona February 23, 2014.

Credit: Reuters/Albert Gea

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SAN FRANCISCO (Reuters) - Growth in global smartphone shipments will fall sharply this year and keep slowing through 2018, with average prices dropping significantly as demand shifts to China and other developing countries, according to market research firm IDC.

Annual growth in 2014 is expected to be 19.3 percent and then decline to 6.2 percent in 2018, IDC said in a report on Wednesday. That follows a 39.2 percent jump in 2013 when smartphone shipments topped 1 billion units for the first time.

The forecast reinforces concerns on Wall Street that the explosion in smartphones that began with Apple's (AAPL.O) iPhone in 2007 is coming to an end, at least in the United States and other developed countries where consumers favor pricey, top-tier handsets.

Smartphone growth in North America and Europe is expected to shrink to single digits and Japan could even see a slight slowdown in shipments in the next few years, IDC said.

Manufacturers are increasingly focusing on China where many consumers are upgrading from basic cellphones to smartphones selling for under $300.

"New markets for growth bring different rules to play by and 'premium' will not be a major factor in the regions driving overall market growth," IDC analyst Ryan Reith said in a report.

The average selling price for smarpthones last year was $335, already far below flagship devices like the iPhone 5S or Samsung Galaxy S4, and will fall to $260 by 2018, IDC said.

(Reporting by Noel Randewich; Editing by Marguerita Choy)

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