Smartphone sales expected to flatten out

Huawei's new P8, launched last week, undercuts some of its big-name rivals.
Date:8 July 2015 Tags:,

Although mobile phones will continue to dominate the device segment in the global IT market (with growth in Apple phones, especially in China, keeping overall phone spending consistent), overall smartphone unit growth will start to flatten, say analysts Gartner.

Gartner says worldwide IT spending will decline 5,5 % in 2015 and is on pace to total $3,5 trillion. That’s a 5,5 per cent decline from 2014.

Analysts attribute the decline to the rising US dollar.

“We want to stress that this is not a market crash. Such are the illusions that large swings in the value of the US dollar versus other currencies can create,” said John-David Lovelock, research vice president at Gartner. “However, there are secondary effects to the rising US dollar. Vendors have to raise prices to protect costs and margins of their products, organisations and consumers will have to make new purchase decisions in light of the new prices.”

The Gartner Worldwide IT Spending Forecast is the leading indicator of major technology trends across the hardware, software, IT services and telecom markets. For more than a decade, global IT and business executives have been using these highly anticipated quarterly reports to recognise market opportunities and challenges, and base their critical business decisions on proven methodologies rather than guesswork.

Communications services will continue to be the largest IT spending segment in 2015 with spending at nearly $1.5 trillion. However, this segment is also experiencing the strongest decline among the five IT sectors. Price erosion and competitive threats are preventing revenue growth in proportion to increasing use within most national markets.

In the device market, mobile phones continue to be the leading segment, with growth in Apple phones, especially in China, keeping overall phone spending consistent. However, overall smartphone unit growth will start to flatten. The PC and tablet markets continue to weaken. The expected 10 per cent increase in average PC pricing in currency-impacted countries is going ahead, delaying purchases even more than expected. Excessive PC inventory levels, especially in Western Europe, need to be cleared. That will delay Windows 10 inventory in the second half of the year.

(Source: Gartner)






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