China’s Smartphone Market Finally Cools

Chinas Smartphone Market Finally Cools Chinas Smartphone Market Finally CoolsThe white-hot growth of China’s smartphone market has finally cooled to red-hot levels.

Following nine consecutive quarters of what IDC calls “explosive growth” that propelled China into the top smartphone market in the world, the China smartphone market experience a slowdown in the final quarter of 2013.

According to the International Data Corporation (IDC) Asia/Pacific Quarterly Mobile Phone Tracker, Chinese smartphone shipments dipped by 4.3% quarter on quarter.

Several factors drove this stumble – for one, China Mobile’s 4G TD-LTE network went live on December 18, translating into supplies of 4G handsets not able to reach the market fully until 2014 Q1. The increasing popularity of phablets and channel inventory also played a role, whereby operators cut phone subsidies on phones with smaller screens, triggering distribution channels looking to clear out those stocks.

“The world has increasingly looked to China as the powerhouse to propel the world’s smartphone growth and this is the first hiccup we’ve seen in an otherwise stellar growth path,” says Melissa Chau, a senior researcher for IDC.

“There will certainly be future drivers to unlock further smartphone growth in China, as Apple demonstrated with its China Mobile tie-up in January, and the massive device migration to come of phones only supporting 2G and 3G networks to devices supporting 4G networks,” Chau explains. “However, we are now starting to see a market that is becoming less about capturing the low-hanging fruit of first time smartphone users and moving into the more laborious process of convincing existing users why they should upgrade to this year’s model.”



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