IDC predicted smartphone shipments would decline 11.9 per cent to 1.2 billion units in 2020 as the Covid-19 (coronavirus) pandemic impacts consumer spending, but noted 5G models could prove crucial in reigniting demand.
In a statement, senior research analyst Sangeetika Srivastava said inital problems on the supply side caused by the pandemic had now evolved into a “global demand-side problem”.
“Nationwide lockdowns and rising unemployment have reduced consumer confidence and reprioritised spending towards essential goods, directly impacting the uptake of smartphones in the short-term”.
She tipped 5G devices to play a “vital role” in a return to growth for the overall sector from Q1 2021.
But programme VP Ryan Reith noted vendors are likely to face increased competition for consumers’ cash from goods including PCs, monitors and games consoles.
“We believe this will result in even more aggressively priced 5G smartphones than expected prior to the pandemic,” though vendors which “position their portfolios to capitalise on this change” could reap the benefit in terms of market share gains.
The bulk of the annual decline looks set to occur in the first half, with IDC expecting shipments to be down 18.2 per cent year-on-year.
Over the full year, Europe was tipped for a double-digit decline due to the heavy impact of the pandemic in Spain and Italy among others. But the company noted leading vendors could maintain their market shares by altering sales strategies, citing online channels as an opportunity.
China shipments were initially hard hit, but IDC noted an easing of lockdown measures and supply chain disruption was now underway, leading it to predict a single-digit decline this year.
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