Smartphone shipments dip despite growth in 5G devices
NEW DELHI: Indian smartphone shipments declined for a third straight quarter, amid supply constraints and a lack of demand in the industry. Data from International Data Corporation (IDC) India’s quarterly smartphone market tracker stated that the overall Indian smartphone market declined by 4.8% year-on-year (y-o-y) in the first quarter of the year ( Q1 2022).
The decline in shipments comes despite a sharp growth in adoption of 5G smartphones in the country. Navkendar Singh, research director for mobile devices at IDC India, said that 5G smartphone shipments in India grew by 300% y-o-y in Q1 2022.
Upasana Joshi, research manager at IDC India said that 31% of all smartphones shipped during this quarter were 5G phones, with their average selling price being about ₹29,000.
Singh said that the growth in 5G phones is a result of wider availability of 5G chips across price points, as well as a natural evolution of technology originating in China.
Joshi said that with supply constraints easing up, by the end of 2022, all smartphones priced above around ₹23,000 should be 5G-enabled.
This, though, may not be enough to push the smartphone market back into growth phase. Last month, experts said that a number of factors such as the global supply chain crisis, lockdowns due to a fresh wave of the Covid-19 pandemic in China, lack of consumer demand, stagnation in innovation, and rising inflation and supply costs leading to higher consumer prices have all contributed to this overall market slowdown.
IDC data for Q1 2022 stated that Xiaomi and Oppo were the two biggest losers in terms of shipments between January and March.
Xiaomi, the largest smartphone original equipment manufacturer in India by volume, saw its shipments decline by 18.2%, while Oppo, in fifth place, saw a 24.9% decline. The two were the biggest single-brand losers during the quarter.
Singh said that the forecast for the rest of the year is also bleak.
“Because of rising inflation and the 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,” he said.
The slowdown in shipments has also been compounded by Indians using their existing smartphones for much longer than before, since they no longer feel compelled to upgrade their devices.
Tarun Pathak, research director at Counterpoint India, told Mint on May 5 that while the average upgrade cycle for an Indian smartphone user is 27 months right now, but this may increase by another two months by the end of 2022.