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S. Korea’s smartphone market likely to shrink for first time
Publication Date : 15-10-2013
South Korea’s smartphone market will likely post negative growth this year, and not recover last year’s sales level for at least the next six years, according to research institute Strategic Analytics Monday.
Experts expect that the sluggish demand for the handsets could further encourage Korean mobile makers to deploy more aggressive global marketing tactics.
The sales of smartphones this year will be 26.3 million units, down 14 per cent from 30.7 million sold last year, according to the SA report.
This would be the first time that smartphone sales have recorded downward movement since Apple’s iPhone, was introduced in 2007.
The major global smartphone markets, meanwhile, are expected to grow by 42 per cent in 2013, the report said.
China, which is expected to record sales of 315.5 million units this year, is predicted to see sales of 424.2 million smartphones in 2018.
An estimated 176.9 million units will be sold in the US in 2018, 140 million in India, and 47 million in Japan in the same year.
SA forecasted that the Korean smartphone market would regain growth momentum, albeit to a limited extent, from next year to 2018.
Around 26.7 million units of smartphones are expected to be sold in 2014, 27.1 in 2015, 27.5 in 2016, 27.9 in 2017, and 28.3 in 2018.
Saturation of the market with a high penetration of premium handsets, and government regulations on subsidies provided by telecommunications firms to customers, are said to be some of the factors that will hamper sales growth in the coming years.
“The sales record of last year, 30.7 million units, indicates that most customers who have purchasing power have already bought smartphones,” said a market analyst, adding, “Four years after iPhone 3GS was launched in the Korean market in 2009 the market has been saturated and consumers now tend to change their mobile phones less often.”
According to a June report by SA, the smartphone penetration of Korea ranked first with 67.6 per cent of the population owning a smart handset.
The organisation projected that around 80 per cent of the population would use a smartphone this year.
“The Korean electronics firms will move focus toward the global market, especially the Chinese market,” the analyst said.
The prediction of SA is in line with the global marketing efforts of Korean smartphone makers including Samsung Electronics and LG Electronics.
First unveiling their flagship smartphones in the United States, Samsung and LG recently beefed up their global marketing efforts.
It is said that around 90 per cent of Samsung’s sales come from foreign markets.
LG currently sells its G2 smartphone through 130 telecommunications firms, two times more sales channels than those for the Optimus G and Optimus G Pro.