INTELLIGENT BRANDS // Mobile Technology
Africa’s mobile market
remains flat as smartphone
shipments decline
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A
frica’s overall mobile phone market
remained flat in Q1 2018 although
smartphone shipments declined for
the second successive quarter, according to
the latest insights from International Data
Corporation (IDC).
The global technology research and
consulting firm’s recently published
Quarterly Mobile Phone Tracker shows that
a total of 52.1 million mobile phones were
shipped in Q1 2018, down 6.3% quarter on
quarter (QoQ) and 3.9% year on year (YoY),
with the continent’s two biggest markets –
Nigeria and South Africa – underperforming
and posting QoQ declines of 6.4% and
27.4% respectively.
“Nigeria’s modest performance can be
attributed to the fact that smartphone
adoption continues to be hindered by
expensive broadband rates and slow Internet
connectivity,” said Nabila Popal, a Senior
Research Manager at IDC. “The drop in South
Africa is simply down to seasonal factors, with
Q1 traditionally being the slowest quarter of
the year and unable to match the buoyant
sales seen in Q4, traditionally the strongest,
when demand is stirred by Black Friday and
the Christmas season.
“While South Africa is one of the continent’s
most developed markets, a large proportion
of the market still centers around low-end to
mid-range devices priced below US$150.
“Affordable smartphones that fall into this
price range have seen a lot of growth over
the last two years, fuelled by local brands
like Mobicell, MINT and Vodacom. With
disposable income limited for the majority of
consumers, most spending on mobile devices
takes place in Q4, leading to an inevitable
drop-off in Q1.”
Looking at smartphones in isolation,
shipments declined 4.5% QoQ for the
first quarter of the year to total 20.4
million units. This represents a decline of
4.4% YoY, which is an improvement on
the 13.7% YoY decline seen in Q4 2017.
Transsion brands continued to lead the
smartphone category in Q1 2018 with
32.1% share of the market’s shipments,
followed by Samsung in second place with
25.4% share. In the feature phone space,
shipments totalled 31.7 million units in
Q1 2018, down 7.4% QoQ and 3.6% YoY.
Feature phones continue to account for the
majority share (60.8%) of Africa’s overall
mobile phone market and their resilience
in this region can be attributed to factors
such as their affordability and long battery
lives. Telco and Itel continued to dominate
Africa’s feature phone market in Q1 2018
with a combined unit share of 57.8%.
“Feature phones remain a viable option
throughout the continent as hardening
economic conditions have taken their toll on
consumer spending,” said Ramazan Yavuz, a
Research Manager at IDC.
“The volatile exchange rates that have
inflicted many countries across the region
are delaying the penetration of affordable
smartphones into wider segments of the
consumer base, which is why we continue to
see feature phones account for such a large
share of the overall market.”
Looking ahead, IDC expects Africa’s overall
mobile phone market to grow 0.5% QoQ
in Q2 2018, while shipments for 2018 are
forecast to decline 0.6% YoY. Demand
for feature phones is expected to remain
strong, although IDC expects vendors to
drive smartphone uptake by offering more
features in affordable price bands.
“The local brands that are equipped with
a strong knowledge of local needs and the
flexibility to adjust mobile phone prices
locally will strongly appeal to African
consumers, and their growth will accelerate
the uptake of smartphones in the mid-term,”
added Yavuz. n
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