Smartphone shipments dip despite growth in 5G devices

NEW DELHI: India’s smartphone shipments fell for the third consecutive quarter in the January to March period due to muted demand and supply disruptions, according to International Data Corp.’s quarterly smartphone market tracker.

The country’s overall smartphone market declined 4.8% from a year earlier in the three months ended March, according to IDC.

The drop in shipments comes despite the sharp growth in 5G smartphone adoption in India. Navkendar Singh, research director, mobile devices, IDC India, said in an interview that 5G smartphone shipments in India jumped 300% from a year earlier in the March quarter. Upasana Joshi, research manager, IDC India, said 31% of smartphones shipped in the quarter were 5G phones, with an average selling price of ₹29,000.

Singh said the growth in 5G phones is due to wider availability of 5G chips across price points, as well as a natural evolution of technology originating in China. With supply constraints easing, by the end of 2022, all smartphones priced above ₹23,000 will be 5G-enabled, Joshi added. However, it may not be enough to revive the market. Industry experts said in April that factors such as the global supply chain crisis, lockdowns due to a fresh wave of Covid in China, lack of demand, stagnation in innovation, and rising inflation and supply costs are leading to higher phone prices, impacting demand.

According to IDC, Xiaomi and Oppo were the top two losers in terms of shipments. Xiaomi, India’s leading smartphone brand, saw shipments drop 18.2% while fifth-ranked Oppo recorded a 24.9% decline in the March quarter.

The outlook for the year also remains bleak. “Due to rising inflation and lengthening of the smartphone refresh cycle, we expect 2Q22 also to remain muted. Smartphone supplies would gradually return to normal, resulting in a slower 1H22 compared to 72 million shipments in 1H21,” Singh said.

According to Tarun Pathak, research director at Counterpoint India, while the average upgrade cycle for smartphone user in India is currently at 27 months, it may rise by two months by December-end. In 2015, the upgrade cycle was six months.

The refurbished devices sector is making the most of this opportunity, boosted by a rise in organized retailers in a traditionally unorganized sector, which is expected to grow from $6 billion now to $10 billion by March 2026, according to market researcher Redseer.

THE SMARTPHONE MARKET DECLINED 4.8% FROM A YEAR EARLIER IN THE THREE MONTHS ENDED MARCH