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Tag: iphone

  • Korean iPhone owners claim low trade-in prices

    Korean iPhone owners claim low trade-in prices

    iPhone users are accusing Apple of paying Korean customers less for their trade-ins than the devices are worth, while noting differences between promotions in other countries and those in Korea.  If an iPhone owner wants to return an older model when buying a new device, iPhone Korea said it will offer up to a 300,000-won ($268.56) discount on the latest smartphones, the iPhone XS and iPhone XR. Korean customers are outraged.

    They claim that the deal has been made available to them a full month later than in other countries. In the United States, Japan and China, trade-in opportunities started in late November. The amount in compensation is also said to be too low.

    Apple Korea announced on Dec. 24 that it is taking iPhone trade-ins at its retail store in Garosugil, Seoul, and will continue to do so until late January next year.

    If the user returns an older model, it is possible for them to buy the 990,000 won iPhone XR for 690,000 won and the 1.37 million won iPhone XS for 1.07 million won.

    Internet community Clien exploded with comments on Dec. 25, the day after the announcement. “I might as well sell it at the Gangbyeon Electronics Mart rather than returning it to Apple,” said one. Another added: “It is disrespecting the customers.”

    While iPhone Korea only compensates up to 300,000 won for an iPhone 7+ released two years ago, the price for an iPhone 7+ in the second-hand market near Gangbyeon and Sindorim is around 380,000 won, according to mobile community Cetizen.

    If the product is an S class with almost no cracks, the price goes up to 450,000 won.

    After typing in the serial number for a black iPhone 7 with 128 gigabytes into the trade-in page on Apple Korea’s website, a reporter received a quote of 174,000 won. In the second-hand market, users can sell the phone for at least at 289,000 won. Apple is offering 115,000 won less for the device.

    Lee Doo-hee, a programmer who enjoys using Apple products said, “I can get more money if I sell directly, so I do not feel any need to go to the Apple store in person and exchange my iPhone.”

    Apple U.S. announced that it is offering trade-ins of about $300 for those buying an iPhone XR and iPhone XS. This is about 10 percent more than in the Korean market.

    NTT Docomo, Japan’s No. 1 mobile company, is offering the iPhone XR for 25,920 yen ($235.05), around 260,000 won, for those signing a two-year contract. No similar discounts are offered in Korea.

    “For Apple, Korea is the home turf for Samsung Electronics, Apple’s old enemy,” according to a source in the sector.

    “Apple only has to get a fair amount of earnings from hard-core iPhone fans, which possibly account for 15 percent of all mobile communications users in Korea. That is why it is pursuing unfavorable policies, like excluding certain countries from promotions.”

    It is believed that the current promotion from Apple Korea is due to the slump in sales of recent iPhones. High prices are seen as the main cause of the recent slowing of sales growth.

    Kuo Ming-chi, a Taiwanese Apple expert as well as an analyst at TF International Securities, has revised his first-quarter 2019 sales volume estimate for iPhones from a 47 million to 52 million range to a 38 million to 42 million range.

    A report written by Kuo was titled: “Shipments of iPhones in 2019 could be below 190 million.”

    The market value of Apple exceeded one trillion dollars in September last year. It is now around $700 billion.

  • Apple assembler Foxconn considering iPhone factory in Vietnam

    Apple assembler Foxconn considering iPhone factory in Vietnam

    Apple’s biggest iPhone assembler Foxconn is considering setting up a factory in Vietnam to mitigate any impact of the ongoing trade war. The report from Vietnamese state media comes after several executives interviewed last week singled out Vietnam and neighboring Thailand as preferred destinations should they need to shelter operations from the trade war, braving hurdles such a lack of skilled labor and inadequate infrastructure.

    Foxconn Group and the Hanoi People’s Committee are working together to open an iPhone manufacturing facility in Vietnam to negate the impacts of the U.S.-China trade war.

    Vu Tien Loc, head of the Vietnam Chamber of Commerce and Industry, raised the matter with Prime Minister Nguyen Xuan Phuc at a meeting on Nov. 22.

    “We are discussing the possibility of this with Foxconn,” Loc said, without elaborating. Hanoi People’s Committee Chairman Nguyen Duc Chung declined to comment.

    Taiwan’s Foxconn, formally Hon Hai Precision Industry Co Ltd said it “follows a strict company policy of not commenting on any matters related to current or potential customers, or any of their products”.

    In trade talks on Saturday, U.S. President Donald Trump and Chinese President Xi Jinping agreed not to introduce any tariffs for 90 days as negotiations continue.

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  • Amazon briefly edges out Apple to top Nasdaq

    Amazon briefly edges out Apple to top Nasdaq

    Amazon briefly became the most valuable company on Wall Street in intraday trade on Monday, days after Microsoft dethroned long-time leader Apple. Amazon rose by 4.7 percent at one point, putting its market capitalization at $865.0 billion. At the same time, Apple traded up 2.1 percent, giving it a market capitalization of $864.8 billion.

    Microsoft, which on Friday closed above Apple’s market capitalization for the first time in eight years, was up 0.9 percent, leaving its stock market value at $859.0 billion, third in the group.

    Amazon’s lead lasted only a few seconds. At the close, Apple was back on top with a 3.49 percent increase in its stock that put its total value at $877 billion. It was followed by Amazon, up 4.86 percent with a market capitalization of $866.6 billion, and then Microsoft, up 1.08 percent and a stock market value of $860.4 billion.

    The tight race between the trio of high-powered technology stocks coincided with a broad stock market rally after the United States and China agreed on a temporary truce in their ongoing trade dispute.

    Apple in August became the first U.S. publicly listed company to reach a $1 trillion market capitalization, but its share price has fallen sharply in recent months as investors worried that demand for iPhones was losing steam.

    Its market capitalization overtook Microsoft’s in 2010 as Microsoft struggled with slow demand for personal computers, due in part to the explosion of smartphones like the iPhone.

    Amazon’s stock has recovered most of the ground it lost after the online retailer in October forecast disappointing sales for the holiday quarter.

  • Apple pilloried over display model policy

    Apple pilloried over display model policy

    Just before the Fair Trade Commission comes to a decision on whether Apple has violated domestic fair trade laws, Korean phone distributors are calling the tech giant out for being the only phone manufacturer in the country that makes them pay for display phones in their stores.

    The Fair Trade Commission (FTC) is due to hold a meeting in mid-December after two years of investigating accusations against Apple and finally decide whether the company indulged in unfair practices. Some complaints are that Apple charges mobile carriers for repair and advertising costs of Apple products.

    On Wednesday, the Korea Mobile Distributors Association (KMDA) accused the company of doing something that no other handset maker did in Korea. “Apple doesn’t let us sell iPhones at all if we don’t purchase the demo phones needed for store displays,” read a statement from the KMDA. “Other manufacturers provide the display phones themselves, and come to collect them later.”

    According to the association, Apple even charged retailers for the costs of building shelves for display models and controlled where the promotional posters for new products were placed. Most of the demo devices are priced at around 70 percent of the market price. Distributors say they also had to purchase demo iPads and Apple Watches.

    iPhones are getting more costly, which could be a factor in the distributors going public with complaints against the company.

    In the past, Apple phones cost no more than 1 million won ($883). Last November, the iPhone X launched just three weeks after the iPhone 8 with a 1.42 million won price tag for a 64 gigabyte model. With the release of the iPhone XS, XS Max and XR on Nov. 2, iPhone prices have reached new highs. The iPhone XS Max is selling for more than 30 percent higher than the iPhone X at 1.97 million won for a 512 gigabyte model.

    “Previously, I spent around 1.1 million won on demo devices for Apple’s new products,” said a 53-year-old owner of a wireless store in Jongno District, central Seoul.

    Branches of the three major mobile carriers – SKT, LG U+ and KT – are the main distributors of mobile phones in Korea.

    “But recently, with Apple products becoming more expensive, the costs I have to bear have risen tremendously,” he said.

    The owner estimated that he spent nearly 5 million won on purchasing demo phones for Apple’s newest models.

    According to industry estimates, each mobile retailer spends around 2.9 million won a year purchasing Apple demo phones. This means that Apple will earn around 25.5 billion won in total sales of demo phones from the country’s 8,800 wireless stores.

    “We are not trying to sue Apple right away at this point, but rather figure out who holds responsibility,” added a KMDA spokesman. “Mobile carriers may be responsible for allowing Apple to pursue such unfair practices, leaving distributors to pay for the costs.”

    Korea is not the only country that has investigated Apple for unfair practices. This July, Japanese authorities called out the tech giant for antimonopoly practices that included forcing local mobile carriers to subsidize iPhone prices to boost sales. In 2016, France sued Apple for $55 million over unfair practices that also involved unfair contracts.

    Apple has not released an official response to the KMDA’s complaints.

    Sales of Apple’s new products have been less than stellar, which is also fueling dissatisfaction among distributors. According to industry estimates, the number of customers buying Apple’s three newest models between Nov. 2 and Nov. 7 was only 60 percent of the number that purchased Apple’s iPhone X and iPhone 8 in their first week last November.

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  • Retailers attack ‘unfair’ Apple South Korea practices

    Retailers attack ‘unfair’ Apple South Korea practices

    Apple South Korea is under fire from retailers, accused of using unfair commercial practices. South Korean retailers have joined forces to confront Apple’s continuous “gapjil” — a uniquely Korean term referring to the abuse of power by someone against a person in a weaker position — that has put an increasing financial burden on their operations.

    The Korea Mobile Distribution Association has claimed in a statement that Apple South Korea had habitually forced local dealers to buy the iPhone maker’s new models for demonstration or demo phones, as opposed to other brands’ practices, putting an increasing financial burden on them, and that “they cannot stand it anymore”.

    The retailers say they had no choice but to accept Apple’s overbearing demands, since the popular iPhone’s position in the market makes it difficult to ignore, to say the least.

    It is reported that the retailers had to buy Apple’s new models including the iPhone XS, iPhone XS Max and iPhone XR, but having to buy too many new models in a short period of time and the “exorbitant prices” of the new phones resulted in a significant financial burden.

    According to the KMDA, most mobile phone manufacturers offer their new models for demonstration for free, and collect them when newer models are released. Apple, however, has imposed additional conditions regarding the brand’s new model promotion: forcing retailers to pay for the manufacturing cost of phone stands, and determining where the stands and promotional posters will be placed in stores, according to local retailers.

    Domestic mobile carriers are no exception to Apple’s overbearing position. Industry watchers say local carriers had to shoulder advertising expenses aimed to promote Apple’s new lineup. Even the costs of subsidy plans and repair fees for Apple’s phones tend to be covered by mobile carriers.

    The Fair Trade Commission ruled that Apple South Korea’s sales practices were in violation of local competition laws, and sent a review report to the iPhone maker that indicates the corresponding fines and required measures to address the company’s anticompetitive behavior. Apple has yet to respond.

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  • Apple concerns hit supplier stocks

    Apple concerns hit supplier stocks

    Shares in Asian suppliers and assemblers for Apple fell on Tuesday after several component makers warned of weaker than expected results, leading some market watchers to call the peak for iPhones in several key markets. Following a poor forecast earlier this month, analysts and investors voiced concern over the state of Apple’s business, contributing to growing worries that iPhone sales were stagnating and could hurt suppliers.

    Fresh warnings on Monday from screen maker Japan Display, British chipmaker IQE and Lumentum Holdings, the main supplier of the Face ID technology in the latest generation of iPhones, hurt technology stocks in Asia on Tuesday.

    Taiwan-based assembler Hon Hai Precision Industry (Foxconn) dropped more than 3 percent. Rival Pegatron fell more than 5 percent but later recouped losses. Both companies count Apple as a major customer.

    The world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing, fell 2.6 percent, while Flexium Interconnect was down 1.5 percent. The Taiwan Weighted Index was down around 1.6 percent.

    “Apple’s iPhone weakness has been a long-term issue for the Asia supply chain,” said Arthur Liao, an analyst at Fubon Research in Taipei.

    “For Apple, iPhone shipment has reached its peak. For tech suppliers facing the future, they have no other big client like Apple.”

    The company’s shares fell to their lowest level in more than three months on Monday.

    Last week, a media report saying the iPhone maker had told its smartphone assemblers to halt plans for additional production lines dedicated to its new lower-priced iPhone XR had pressured supplier stocks.

    Analysts said the lack of technological breakthroughs had put a cap on demand.

    “With no new technology in sight next year for the supply chain, this is not ideal for the companies involved,” said Nicole Tu, a Taipei-based analyst at Yuanta Investment Consulting.

    “Up through the first half of 2019, we likely won’t see any breakthrough.”

    Lumentum on Monday slashed its profit and revenue forecast for the current quarter, while IQE warned that current-year results would be lower. Japan Display lowered both sales and margin outlook for the year as well.

    Apple warned earlier this month that holiday sales would miss Wall Street expectations due to weakness in emerging markets.

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  • New iPhones sell slowly in Korea

    New iPhones sell slowly in Korea

    A week after Apple introduced its latest iPhone series at stores in Korea, sales are only about 60 percent of those reported for the previous lineup over the same period of time. According to estimates compiled by local mobile carriers, a total of 170,000 iPhone XS, XS Max and XR models were purchased between Nov. 2 and Nov. 7. A total of 280,000 iPhones 8 and X models were sold in the first week of their release in November 2017. Sales of the two models began three weeks apart.

    Industry watchers assumed that Apple’s simultaneous release of the three models was designed to garner greater attention and boost sales in the early days.

    However, figures so far show that the latest iPhones are selling more slowly than earlier models.

    “It’s not doing that great,” said an employee at a brick-and-mortar phone shop in central Seoul on Friday when asked if the new iPhones are popular.

    “There’s the expensive price tag, but it also has to do with the fact that there aren’t dramatic function upgrades. To be honest, even I can’t really notice a big difference between the iPhone X and XS. Maybe the next series will come with more innovative features – we’ll see.”

    Price became an issue as soon as Apple introduced the new models. In Korea, the 512-gigabyte iPhone XS Max sells for nearly 1.97 million won ($1,745), while the 256-gigabyte XS retails at 1.56 million won.

    Even the budget XR model is priced slightly below one million won.

    Despite the price concerns, presales have been reasonably strong. SK Telecom, KT and LG U+ took orders between Oct. 26 and Nov. 1.

    Presales results for the three new models differed per company, but the general assessment was that demand was similar or stronger than for previous generation iPhones.

    Presale results don’t necessarily indicate success. Customers who preorder iPhones in Korea, even before actually touching the product, are likely to be loyal Apple fans.

    “The thing about Apple maniacs is that they will get their hands on the next iPhone no matter what,” said a source from one of the mobile carriers.

    “But success doesn’t just come from them. The general public, especially those switching between smartphone brands, should be attracted to buying it, too. The new iPhone seems to be failing in that respect this time.”

    Up until a few years ago, a few manufacturers like Apple and Samsung dominated the smartphone market. Customers nowadays have a much wider ranges of options in terms of price and style.

    Over the last decade, smartphone technology has advanced so much that even budget models priced at half that of the latest iPhones come with high-tech functions, such as face unlock.

    From Apple’s side, there are signs that the company is well aware of the slower demand.

    Japan’s Nikkei Asian Review reported on Monday that Apple told smartphone assemblers Foxconn and Pegatron to halt plans to bring on additional lines for iPhone XR production. All companies involved declined to comment.

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  • Apple’s India profit zooms 140 pc to Rs 896 cr in FY18

    Apple’s India profit zooms 140 pc to Rs 896 cr in FY18

    Tech giant Apple’s India unit registered 140 percent jump in its net profit at Rs 896.3 crore for the fiscal ended March 2018, as per regulatory documents filed by the company. According to a report: The iPhone maker, which competes with the likes of OnePlus and Samsung in the premium smartphone category in India, had registered net profit of Rs 373.3 crore in 2016-17, the documents filed with the Corporate Affairs Ministry showed.

    The company saw its total income (including other income) rising about 12 percent to Rs 13,097.6 crore in FY2018 from Rs 11,704.3 crore in the previous financial year, documents sourced by business intelligence firm Tofler showed.

    During the company’s earnings call in July, Apple CFO Luca Maestri had stated that Apple was witnessing great momentum in emerging markets and that it had established new June quarter records for Mac sales in India.

    Earlier in the year, Apple CEO Tim Cook, too, had emphasised the importance of the Indian market. He had said the company plans to launch all its initiatives, including retail, in India where it has an extremely low overall market share but offers huge opportunities. The CEO also stated that Apple was putting a lot of energy in India and working with the carriers in the market.

    The company has also been steadily increasing its market share in the burgeoning Indian smartphone market. According to Counterpoint Research, the company had a 25 percent market share in the premium category (Rs 30,000 and above) — after OnePlus (30 percent share) and Samsung (28 percent share) — in the third quarter of 2018.

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  • Latest iPhone models sell well in first week out in Korea

    Latest iPhone models sell well in first week out in Korea

    After a week of presales, Apple’s new series of iPhones officially rolled out in the Korean market Friday. The response for the three phones – iPhone XS, XS Max, and the budget XR model – has been good.  According to local mobile carriers, the trio attracted the same number of or slightly more preorders than the previous iPhone generation: the iPhone X and the iPhone 8.

    “Overall, the new phones are generating more interest than the previous series,” a spokesperson from KT said. “Though the iPhone XS is getting more attention than the XR.”

    Presales data from Korea’s largest mobile carrier SK Telecom released Friday shows that 62 percent of the preorders were for iPhone XS, while 26 percent were for iPhone XS Max and 12 percent for the iPhone XR.

    The most popular color option was gold for iPhone XS and XS Max, followed by space gray and silver. For iPhone XR, black and white models led.

    The new phones are big with the young. About 30 percent of the early buyers were women in their 20s, according to SK Telecom. People in their 20s including men accounted for half of all customers making early reservations for the iPhones.

    “Younger people seem to be more interested in buying the new iPhones,” SK Telecom said in statement.

    As for storage, the 256 gigabyte (GB) option was the most popular for both iPhone XS and iPhone XS Max. Considering users have to pay over 1.8 million won (＄1,611) for the 512GB option, many customers favored the slightly less pricey option. For iPhone XR, the mid-priced 128GB option was more popular than units with 64GB or 256GB of storage.

    It will take time to judge the true demand for the new phones from Apple, and questions are being raised as to whether the brand is up against the limits of efficiency gains and losing momentum.

    Apple posted ＄14.1 billion in net profit in the third quarter, up 32 percent year on year. Investors focused on weak unit sales and weaker-than-expected revenue guidance for the fourth quarter. Apple said it sold 46.89 million iPhones in the third quarter, a mere 0.4 percent increase year on year and below analyst expectations of 47.5 million unit sales. The revenue increase came from higher pricing.

    The U.S. phone maker also announced that starting next year it will not be reporting a breakdown of sales by product line. Luca Maestri, chief financial officer at Apple, said in a conference call Thursday that unit sales are no longer a good measure of the company’s performance.

    Apple stock fell by as much as 7.4 percent in aftermarket trading.

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  • Apple profit driven by higher iPhone models

    Apple profit driven by higher iPhone models

    Tech giant Apple Inc. may not have sold as many iPhones during the quarter ending September 30, but the company’s pricier models are driving its profits higher than ever. The California-based company reported it sold about 46,889 iPhones during the quarter, almost the same number of iPhones sold in the previous corresponding period.

    Apple was selling its iPhone ASP at $793 during the quarter compared to the $618 price of the unit in the corresponding quarter a year ago. The company has also introduced the iPhone XS in September at a price starting $999 and the iPhone XS Max which costs about $100 more than the XS model.

    The tech company has posted a 20 per cent increase in its quarterly revenue for the quarter to $62.9 billion, and quarterly earnings per diluted share of $2.91, up 41 per cent.

    International sales accounted for 61 per cent of the quarter’s revenue.

    Apple’s services revenue has seen a 27-per cent increase of $10 billion.

    “We’re thrilled to report another record-breaking quarter that caps a tremendous fiscal 2018, the year in which we shipped our two billionth iOS device, celebrated the 10th anniversary of the App Store and achieved the strongest revenue and earnings in Apple history,” said Tim Cook, Apple’s CEO.

    Cook said with their recently introduced new versions of iPhone, Apple Watch, iPad and Mac, and the company’s four operating systems, they have entered the holiday season with their “strongest lineup of products and services ever.”

    “We concluded a record year with our best September quarter ever, growing double digits in every geographic segment. We set September quarter revenue records for iPhone and Wearables and all-time quarterly records for Services and Mac,” said Luca Maestri, Apple’s CFO. “We generated $19.5 billion in operating cash flow and returned over $23 billion to shareholders in dividends and share repurchases in the September quarter, bringing total capital returned in fiscal 2018 to almost $90 billion.”

    Apple is looking at a revenue of between $89 billion and $93 billion for the first quarter of the 2019 fiscal year, a gross margin of 38 per cent and 38.5 per cent, and operating expenses between $8.7 billion and $8.8 billion.

    Apple’s board of directors has declared a cash dividend of $0.73 per share of the Company’s common stock. The dividend is payable on November 15.

    Neil Saunders, managing director of GlobalData Retail, said the quarter’s results underlines all of the innovation the company has put into its suite of products over the past year.

    “Admittedly, the new iPhone XS and XS Max versions, along with Apple Watch Series 4, were only available at the very end of this quarter, but we still believe they had a positive material impact on sales,” Saunders said.

    Saunders said with the tech giant’s strong release of products, the potential launch of new services, and more sessions being added to better stores, Apple has set itself up for another year of growth.

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  • Shibuya Apple store reopens after a year of renovation

    Shibuya Apple store reopens after a year of renovation

    The Shibuya Apple store in Tokyo has reopened today with striking modern styling, coinciding with the release of the iPhone XR. The new four-storey design features dramatic natural lighting and a new spiral staircase, described as “stunning” by local media. The store, which reserves substantial space for back-of-house activities, took 11 months to transform, during which time two further stores were opened in Japan.

    The original Shibuya store, which opened in 2005 as the fourth in Japan, was also well-known for its distinctive spiral staircase, reflective of Apple’s retail aesthetics at the time. The new design is closer in look to that of the Steve Jobs Theatre.

    Comparing the original design with the revamp offers a unique perspective into Apple’s evolving retail architecture. The earlier version of the store, optimised for the iPad era, has been enlarged vertically rather than relocated to more expansive premises, indicating the importance to Apple of the location over the venue’s suitability for the brand’s contemporary retail features such as its video wall, which is conspicuously absent in Shibuya.

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  • Apple has redesigned new iPhones in China

    Apple has redesigned new iPhones in China

    Apple has made a rare special concession to Greater China with the design of its newest line of smartphones, revealing that new iPhone XS and iPhone XS Max produced for the market will not support the new eSIM feature.

    The eSIM feature, which supports two simultaneous carriers and is designed to allow more convenient switching between them, will not be available in Hong Kong, mainland China and Macau.

    Instead, the devices in these markets will offer slots for two physical SIM cards. This represents a rare case of Apple tailoring iPhones to a specific market.

    The report notes that it is unclear whether the special arrangement is to comply with any Chinese regulations, or merely as a result of pressure from the market’s operators reluctant to enable such easy switching between carriers, and Apple has not commented on the matter.

    But whatever the reason, the concession demonstrates that Apple is willing to take extraordinary steps to maintain its foothold in the world’s largest smartphone market. Greater China was responsible for around 20% of Apple’s total revenues during its 2017 financial year – around $45 billion.

    The company is under increasing competitive pressure from local vendors including Huawei and Xiaomi, which can differentiate by offering more locally oriented services.

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  • Apple will likely reveal next iPhone on Sept. 12

    Apple will likely reveal next iPhone on Sept. 12

    Apple said on Thursday that it would host an event on Sept. 12 at the Steve Jobs Theater at the company’s Cupertino, California, campus, where it is widely expected to unveil new iPhone models.

    Analysts believe Apple plans to release three new smartphones this year, including one with a larger display than previous models. Analysts also expect Apple to release an iPhone with an edge-to-edge display similar to the iPhone X but using less-costly LCD screen technology.

    Apple’s event invitation made heavy use of the color gold, fueling speculation on social media that the company plans to launch a gold-colored successor to the iPhone X, which is only available in silver and gray.

    Documents filed with the U.S. Federal Communications Commission that were unsealed earlier this year showed Apple had sought approval for a gold version of its iPhone X, but it never released the phone with the color.

    A few hours after Apple’s announcement, 9to5Mac, a technology news website, posted photographs of two gold iPhone models stacked on top each other, with a larger-screened model on the bottom. Both models resemble the current iPhone X.

  • Smartphone Sales Will Drop for Second Straight Year, IDC Predicts

    Smartphone Sales Will Drop for Second Straight Year, IDC Predicts

    Global smartphone sales are expected to fall for the second year running this year, before  returning to growth next year, according to analysis by the International Data Corporation (IDC).

    In the research house’s Worldwide Quarterly Mobile Phone Tracker, smartphone shipments are forecast to drop 0.2 per cent this year to 1.462 billion units, after a 0.3 per cent decline last year. Looking further out, IDC expects the market is to grow roughly 3 per cent annually from next year onwards, with worldwide shipments reaching 1.654 billion in 2022 and a five-year compound annual growth rate (CAGR) of 2.5 per cent.

    The biggest driver of last year’s decline was China, where smartphone sales declined 4.9 per cent year-on-year. And the IDC expects sales in China to decline a further 7.1 per cent this year before flattening out next year.

    The biggest growth market in Asia Pacific continues to be India, with volumes expected to grow 14 per cent and 16 per cent this year and next.

    “Chinese OEMs will continue their strategy of selling large volumes of low-end devices by shifting their focus from China to India,” says IDC. “So far, most have been able to get around the recently introduced Indian import tariffs by doing final device assembly at local India manufacturing plants. As for components, almost everything is still being sourced from China.”

    “With 2017 now behind us a lot of interesting market dynamics are unfolding,” says Ryan Reith, program VP with IDC’s Worldwide Quarterly Mobile Device Trackers. “Even though it declined 5 per cent last year, China remains the focal point for many given that it consumes roughly 30 per cent of the world’s smartphones.

    “But plenty of pockets of growth can be found beyond China. India is now grabbing headlines and the market itself is going through some rapid transformation. Local Indian manufacturing continues to ramp up, despite still having a heavy dependence on China for components. The boom in India is likely to continue in the years to come, but the move toward building up local production has certainly caught the eye of many in the industry.”

    Outside of Asia Pacific, the biggest regions for growth will be the Middle East, Africa, and Latin America. All three regions have relatively low penetration rates and plenty of upsides, says IDC. Economic challenges have been the main inhibitor over the past two years, but IDC expects consumer spending to rise throughout the forecast and smartphones to be a big benefactor.

    5G opportunity

    The other catalyst to watch will be the introduction of 5G smartphones. IDC predicts the first commercially ready 5G smartphones will appear in the second half of next year with a ramp up across most regions happening in 2020. IDC projects 5G smartphone volumes to account for roughly 7 per cent of all global smartphone sales in 2020 or 212 million in total. The share of 5G devices should grow to 18 per cent of total volumes by 2022.

    “Although overall smartphone shipments will decline slightly this year, the average selling price (ASP) of a smartphone will reach US$345, up 10.3 per cent from the $313 of last year,” said Anthony Scarsella, research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker.

    “This year will continue to focus on the ultra-high-end segment of the market as we expect a surge of premium flagship devices to launch in developed markets. Devices featuring large Amoled bezel-less displays, advanced camera functions, and an overall increase in speed and performance will be the driving factor in the increase of ASPs. Moving forward, we can expect this trend to continue as the ASP for a smartphone will continue to grow throughout the forecast period. In 2022, the final year of our forecast period, the average selling price for a smartphone will be $362, resulting in a five-year CAGR of 2.9 per cent.”

    Android vs Apple

    Android’s share of t sales is expected to remain relatively stable at 85 per cent of total global smartphone sales. Volumes are expected to grow at a five-year CAGR of 2.5 per cent, with shipments totaling 1.41 billion by 2022.

    “There is no question that Android is the OS of choice for the mass market and nothing leads us to believe this will change,” says IDC. “Given the large number of Chinese OEMs dependent on Google’s OS, as well as components from other US companies like Qualcomm, it will be interesting to see how things develop with all the discussion about a US-China trade war. Android OEMs continue to drive down the cost of new technology features at a rapid pace. IDC estimates that 98 per cent of Android phones will ship with screens larger than five inches by 2022, with 36 per cent being six inches or larger. While some of these will remain premium flagship models, the aggregate ASP of Android phones with a six-inch screen or greater by 2022 is projected to be $414.

    Meanwhile, iPhone volumes are expected to grow 2.6 per cent this year to 221 million. IDC is forecasting iPhones to grow at a five-year CAGR of 2.4 per cent, reaching volumes of 242 million by 2022. With rumors of some upcoming larger screen iOS smartphones, IDC has changed its screen size forecast for Apple by introducing volumes greater than six inches. Products are likely to begin shipping in the fourth quarter of 2018, with volumes ramping up and accounting for 36 per cent of all iPhones shipped by 2022.

  • Hong Kong Customs Roll Up Counterfeit Phone Gangs

    Hong Kong Customs Roll Up Counterfeit Phone Gangs

    A territory-wide Hong Kong Customs raid has resulted in arrests and netted 100 smartphones suspected of being counterfeits.

    During the one-day Operation Snow Leopard, officers raided 12 shops and two storage places, seizing smartphones with suspected false trademarks or bearing possibly false trade descriptions. They also found about 3400 accessories also suspected of being fakes.

    Arrested were 18 men and a woman between 21 and 48 years old, including shop owners and salespersons, while the market value of the seized goods is estimated to be about HK$1.5 million.

    Customs had earlier received information alleging that some phone-repair shops sold suspected counterfeit smartphone accessories, and some shops were suspected to have engaged in unfair trade practices by selling old smartphones as new products, or selling parallel-imported smartphones as authorised products.

    After an in-depth investigation with the help of trademark owners, Customs took the enforcement action yesterday and raided 12 shops.

    Customs also cracked down on a syndicate in connection with export, supply and distribution of suspected counterfeit smartphones and accessories. A total of 64 suspected counterfeit smartphones and 330 suspect accessories were seized from the storage places in Sham Shui Po and Tsing Yi.

    A 32-year-old male head and 34-year-old female member of the syndicate were arrested. With the investigation ongoing, more arrests are possible.

    Intellectual Property Investigation Bureau chief Catherine Yip says the successful detection of the case was attributed to reporting by members of the public and the full help of trademark owners.
    She says Customs will step up inspection and enforcement with the approach of the Labour Day Golden Week.

    Customs says traders need to comply with the requirements of the Trade Description Ordinance (TDO) as the sale of counterfeit goods can lead to a fine of up to $500,000 and imprisonment for five years.

    Meanwhile, Customs has broadened reporting options by introducing a dedicated crime-reporting email account (crimereport@customs.gov.hk).

    Intelligence Bureau chief Kitty Poon says public reports received by Customs have risen progressively by 21 per cent, from 31,994 in 2015 to 38,819 last year. Of these, the proportion received via email has grown from 30 per cent in 2015 to almost 40 per cent last year.

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