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China poised to overtake the United States as world’s top smartphone market

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We Americans like thinking of ourselves as No.1 in everything, but there was simply no way we were going tostay on top of China as the world’s largest smartphone market. The latest research from IDC show that China will account for 26.5% of all smartphone shipments in 2012, up from 18.3% in 2011 and nearly nine percentage points higher than 17.8% of smartphones that will be shipped to the United States this year.

While the U.S. had just barely edged out China in 2011 when it accounted for a world-leading 21.3% of all smartphones shipped, the country is unlikely to ever top the world in smartphone shipments again as IDC projects that its share of global smartphone shipments will fall to 14.5% in 2016 while China’s will level off slightly at 23% as India and Brazil increase their own shares. IDC’s full press release follows below.

 China to Overtake United States in Smartphone Shipments in 2012, According to IDC 

FRAMINGHAM, Mass., August 30, 2012 – Strong end-user demand and an appetite for lower-priced smartphones will make China (PRC) the largest market for smartphones this year, overtaking the United States as the global leader in smartphone shipments. According to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, China will account for 26.5% of all smartphone shipments in 2012, compared to 17.8% for the United States.

“Looking ahead, the PRC smartphone market will continue to be lifted by the sub-US$200 Android segment,” said Wong Teck-Zhung, senior market analyst, Client Devices, IDC Asia/Pacific. “Near-term prices in the low-end segment will come down to US$100 and below as competition for market share intensifies among smartphone vendors. Carrier-subsidized and customized handsets from domestic vendors will further support the migration to smartphones and boost shipments. Looking ahead to the later years in the forecast, the move to 4G networks will be another growth catalyst.”

“Regionally, we expect smartphone demand to flow down to lower-tier cities,” added James Yan, senior market analyst for Computing Systems Research at IDC China. “After going through a period of sustained high growth, top-tier cities are likely to see decelerating smartphone growth rates. In contrast, secondary cities are expected to experience accelerated smartphone growth, with strong demand for low-cost models as well as high-end models, which are desired as status symbols.”

“The fact that China will overtake the United States in smartphone shipments does not mean that the U.S. smartphone market is grinding to a halt,” said Ramon Llamas, senior research analyst with IDC’s Mobile Phone Technology and Trends program. “Now that smartphones represent the majority of mobile phone shipments, growth is expected to continue, but at a slower pace. There is still a market for first-time users as well as thriving upgrade opportunities.”

“In addition to China and the United States, several other countries will emerge as key markets for smartphone shipment volume over the next five years,” said Kevin Restivo, senior research analyst with IDC’s Worldwide Mobile Phone Tracker program. “High-growth countries such as Brazil and Russia will become some of the most hotly contested markets as vendors seek to capture new customers and market share.”

Top Five Markets for Smartphone Shipments

As it becomes the leading country for smartphone shipments this year, the PRC smartphone market will continue to grow, primarily on demand for lower-cost handsets. While this bodes well from a volume perspective, it also means lower average sales values (ASVs), thinner margins, and increased competition from all players. Over the course of the forecast, China’s share of the global smartphone market will decline somewhat as smartphone adoption accelerates in other emerging markets.

Smartphone shipments into the United States will increase as users upgrade their devices and feature-phone users switch over to smartphones. Furthermore, a combination of lower-priced models, expansion of 4G networks, and the proliferation of shared data plans will encourage continued smartphone adoption. Smartphones are already the device of choice at the major carriers, and regional and prepaid carriers are following suit and competing with alternative service plans.

With smartphone penetration in India currently among the lowest in Asia/Pacific, the market has tremendous untapped growth potential. Low-end smartphones offering dual-SIM capability and local apps and priced around US$100 will rapidly bring this market to life. Although 3G data plans are currently too expensive for the majority of consumers in India, IDC expects the popularization of 3G, and in later years 4G, to drive smartphone uptake as operators roll out more affordable data plans and generous subsidies while expanding offerings to tier 2 and tier 3 cities. The affordability of service plans will be another important key to smartphone adoption in India.

Smartphone growth in Brazil will be bolstered by strategic investments by mobile operators, smartphone vendors, and regulators. Operators’ focus on increasing ARPU will drive greater demand for smartphones while smartphone vendors will look to reap greater profitability from offering such devices. The Brazilian government, meanwhile, will offer tax exemptions for smartphones and protect local manufacturing against foreign vendors. These factors, combined with solid end-user demand, will drive smartphone volumes in the coming years.

The United Kingdom has been one of the fastest growing smartphone markets in Western Europe, driven by the high operator subsidies and long-term post-paid contracts. Over the forecast period, smartphone shipments will continue to increase due to the introduction of LTE and a new range of services that will appeal to heavy smartphone users. In addition, price erosion on HSPA devices will also attract feature phones users. Growth rates will slow in the later years of the forecast as penetration plateaus and operators seek out alternative subsidy models.
Top Five Smartphone Markets and Market Share for 2011, 2012, and 2016 (based on shipments) 

Country 2011 Market Share 2012 Market Share 2016 Market Share 2011 – 2016 CAGR
PRC 18.3% 26.5% 23.0% 26.2%
USA 21.3% 17.8% 14.5% 11.6%
India 2.2% 2.5% 8.5% 57.5%
Brazil 1.8% 2.3% 4.4% 44.0%
United Kingdom 5.3% 4.5% 3.6% 11.5%
Rest of World 51.1% 46.4% 46.0% 18.1%
Total 100.0% 100.0% 100.0% 20.5%

Source: IDC Worldwide Mobile Phone Tracker, 2012 Q2 Forecast Release, August 30 2012

Note: Countries listed in terms of ranking in 2016.

http://www.bgr.com/2012/08/31/global-smartphone-shipments-china-tops-united-states/

How an LTE iPhone could lead to an AT&T exodus

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AT&T (T) had better hope that consumers like its LTE network better than they like its Facetime policiesAllThingsD reports that Jefferies & Co. analyst Thomas Seitz sent a note to investors Friday describing how AT&T could lose a significant number of iPhone users to rival Verizon (VZ) due to the size and quality of its LTE network.  

The numbers Seitz lays out are stark: Verizon’s LTE network currently has 203 million POPs, more than all other American wireless carriers combined. Combine this with Verizon’s traditionally high ratings for network quality, and it’s easy to see how Verizon could easily drag some iPhone users over from AT&T as long as its network holds up. Seitz says that while he doesn’t expect that Verizon’s large LTE network will decimate AT&T’s iPhone user share immediately, it could give Verizon a long-term advantage that pay dividends in terms of customer loyalty.

“We believe this network advantage could lead to a share shift towards Verizon, primarily at AT&T’s expense,” he writes.

http://allthingsd.com/20120831/an-lte-iphone-could-send-some-customers-from-att-to-verizon/?refcat=news

JetBlue fulfills fan’s request for Jets plane

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David Baghdassarian is a huge Jets fan. 

His Florida license plate is JTSFN, his tailgating grill is green and white and he dressed as Rex Ryan for Christmas. No, not Halloween. Christmas. 

So when Baghdassarian was getting ready for a trip back to New York, where he was born and raised, he thought he’d give it a try: Get JetBlue to fly him home in its Jets plane. As part of its partnership with the Jets, the company has been flying around a plane wrapped with a Jets logo since October 2010. Where it flies to and from is usually random, but this Jets fan wanted to change that. 

On Aug. 23, a week before his flight, Baghdassarian (@bags) tweeted to JetBlue executives, who have been particularly active on Twitter.  The Tweet reached its intended targets: Marty St. George, the airline’s vice president of marketing, David Barger, JetBlue’s CEO, and COO Rob Maruster. The next morning, Barger sent the tweet along with the comment “Love it!” to his vice president of airport and system operations, Alex Battaglia, known on Twitter as @B6AirportGuy. 

A few hours later, the main @JetBlue account tweeted to Baghdassarian:  "I was super excited," Baghdassarian, a 40-year-old health care attorney, told ESPN.com. "I didn’t tell too many people because I didn’t want to jinx it." 

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David Baghdassarian
Courtesy of David BaghdassarianDavid Baghdassarian in his Rex Ryan costume.

On Thursday, he showed up at the airport in a Jets T-shirt for the flight and sure enough, when he checked in, there was the plane in its green and white glory. 

"I think it’s so great that CEOs and executives are making themselves accessible to the public and responding to things like this," Baghdassarian said. "It really helps people connect with a company." 

For its part, JetBlue spokesman Morgan Johnston says it was the first time the airline ever got a request from a passenger to specifically have the Jets plane fly him home, though Johnston said it has happened before with some of the company’s other sports planes — a Red Sox one and one draped in Real Salt Lake logos. "We saw his tweet and it wasn’t hard to schedule the plane to fly him home," Johnston said. "Now we obviously can’t have our customers dictating their routes all the time, but when we can listen to our customers, react quickly and do something cool, we obviously make the effort to do so." 

After several high-profile public relations disasters, JetBlue has devoted more attention to reaching out to its customers. At more than 1.6 million followers, JetBlue is not only the most-followed airline, it is also among the most-followed companies on Twitter.

http://espn.go.com/blog/playbook/dollars/post/_/id/1356/jetblue-sends-jets-fan-home-on-jetgreen

Google Now updated with support for movie showtimes, public alerts and sports

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Google (GOOG) on Wednesday updated its Android Search app with some extra goodies for Google Now. The new version adds support for movie theaters, public alerts, enhanced sports information and it now reorganizes Korean. Google Now can be set to display a card that includes movie showtimes based on how a user searches or even if the smartphone is near a theater. The new public alerts card will be displayed during emergencies, and will include information and warnings regarding storms, earthquakes and more. Google previously would supply sports information based on earlier searches, however with the enhanced sports card, users can now manually input their favorite teams to receive scores and updates. The latest version of Google Now is included in the Google Search app, which is available now on the Play Store for users running Android 4.1 Jelly Bean.

https://plus.google.com/u/0/+android/posts/cZAVZEDMPRn

Samsung’s plan for revenge: Sue Apple if it dares release an LTE iPhone

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Samsung (005930) will soon go from licking its wounds to licking its chops if Apple’s (AAPL) next iPhone utilizes LTE technology. The Korea Times reports that Samsung has “confirmed that it will immediately sue Apple if the latter releases products using advanced long-term evolution (LTE) mobile technology.” Although Apple has already released an LTE-capable device with the latest version of its iPad, Samsung is likely waiting for Apple to put out an LTE-capable iPhone before busting out its extensive LTE patent portfolio to seek injunctions. An analysis conducted by IP research firm iRunway earlier this year found that Samsung holds fully 10% of all LTE patents issued so far, meaning it could have ample firepower to take on Apple over its use of LTE in future smartphone releases.

 

http://www.koreatimes.co.kr/www/news/tech/2012/08/133_118544.html

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