Research firm Gartner, which tracks worldwide combined shipments for a broad basket of various mobile devices, is out with a new forecast that warns of an anticipated device shipment decline of 3 percent in 2016 before things improve in 2017.
This would be a second consecutive year of decline, since the worldwide devices market fell by 0.75 percent in 2015.
“The global devices market is not on pace to return to single-digit growth soon,” said Ranjit Atwal, the research director at Gartner. “Growth is on pace to remain flat during the next five years. All segments are expected to decline in 2016, except for premium ultra-mobiles and utility mobile phones (entry level phones), which are expected to show single-digit growth this year.”
Gartner also projects that the market for PCs could experience an 8 per cent decline in 2016, as the installed base bottoms out and replacement cycle extensions halt.
If this situation prevails it means that PC sales will bottom out in 2016. For the PC market to stay on pace for flat growth in 2017, business spending must increase.
“The inventory of Windows 8 PCs should have been cleared, and large businesses in mature markets are now looking to move to Windows 10 through 2018,” noted Atwal. “In addition, more affordable hardware and increasingly available virtual reality content (such as games, stories and other entertainment) will enable consumer PC buyers to upgrade in order to experience immersive offerings.”
The same lackluster news defines smartphone sales growth. Total mobile phone shipments are on pace to decline 1.6 percent in 2016. The smartphone segment continues to grow, albeit more slowly than in previous years, and is expected to reach 1.5 billion units in 2016. In 2016, the Android market will continue to be bolstered by Chinese vendors offering more affordable premium devices.
“This is no surprise; the smartphone market is maturing, and reaching global saturation with phones that are increasingly capable and remain good enough for longer,” said Roberta Cozza, research director at Gartner.
In sum, Gartner researchers expect total smartphone market to increase a mere 4.5 percent in 2016, with premium smartphones declining 1.1 percent in 2016.
“We expect the market for premium smartphones to return to 3.5 per cent growth in 2017, as stronger replacement cycles kick in and in anticipation of a new iPhone next year, which is expected to offer a new design and new features that are attractive enough to convince more replacement buyers,” said Cozza.