Global Smartphone Shipments to Grow 5.3 Percent in 2021 Despite Supply Chain Issues: IDC

Despite supply chain issues, global smartphone shipments will grow 5.3 percent year-on-year (YoY) by the end of 2021, according to a forecast by International Data Corporation (IDC). The market research firm has predicted in its latest report that there will be 1.35 billion smartphone shipments by the end of the year. It also added that since the shortage issues revolve around 4G components, 5G smartphones are set to take center stage with 60 per cent of the total smartphone shipments worldwide by the end of 2022.

according to this worldwide quarterly mobile phone tracker, IDC downgraded its growth forecast for 2021 and 2022 due to lower-than-expected third quarter shipments and continued component shortages and logistical challenges. It added that the situation of shortfall may not improve until mid-2022.

IDC says it has cut its smartphone shipment growth forecast for 2021 from 7.4 percent to 5.3 percent and for 2022 from 3.4 percent to 3.0 percent. Over the long five-year run, IDC predicts “a modest but healthy 3.5 percent five-year compound annual growth rate (CAGR)”. The firm claims that this shipment growth will be attributed to rising demand, lowering Average Selling Price (ASP) and continued transition from feature phones to smartphones.

“While we expected a slowdown in the third quarter, the market declined at almost twice the expected rate, as supply chain and logistical challenges hit every major player in the market,” said Nabila Pople, director of research at IDC’s Mobility and Consumer Device Trackers. Impressed.”

Talking about the performance in various regions during the year, IDC says that all regions are expected to see a single digit decline, and Asia Pacific (except Japan) and China are expected to witness significant reduction. “Smartphone shipments in Asia Pacific (excluding Japan) will shrink by 9.1 percent and in China by 8.4 percent,” says IDC.

According to the research firm, the silver lining is that strong growth in the first half of 2021 across all regions except China will help paint a positive picture of overall growth this year.

On 5G smartphones, Pople said the most affected vendors were those with “a high portfolio mix of 4G devices” and that those offering more 5G models were comparatively less hit. As mentioned above, this is because the supply chain surrounds 4G components according to IDC.

These “challenges have shifted our short-term forecast to Android compared to iOS, which is now primarily 5G,” Pople said.

He also said that this lack of 4G components, which may not become common until mid-2222, will accelerate the leap in 5G technology. IDC estimates that the ASP of 4G and 5G handsets will decrease by 2025.

“As per our previous forecast, 2021 will represent the peak average selling price as Android will end the year at $265 (approximately Rs 19,900), while iOS will climb to $950 (approximately Rs 71,300). However, going forward, the overall Market prices will gradually decline as 5G devices fall by 14.5 percent in 2022, while 4G devices will drop by more than 18 percent next year as the market continues to move toward 5G,” said IDC research director Anthony Scarsella said. Mobile device trackers around the world.