With 2013 quickly coming to an end, a new report from the International Data Corporation (IDC) claims smartphone shipments will surpass one billion units in 2013, following a boost to the market likely due to the holiday shopping season. That’s a 39.3 percent increase over 2012, with no sign the market will slow down in the next few years.
While many point to smartphone saturation—at least in the U.S. and Europe—emerging markets in Asia, Africa and Latin America are rapidly buying up new devices, largely thanks to declining prices for entry-level smartphones. IDC predicts that the average smartphone selling price will drop from $387 in 2012 to $337 in 2013 and just $265 by 2017. In the same year, shipments are expected to hit 1.7 billion units.
“The game has changed quite drastically due to the decline in smartphone ASPs,” said Ryan Reith, a Program Director at IDC. “Just a few years back the industry was talking about the next billion people to connect, and it was assumed the majority of these people would do so by way of the feature phone. Given the trajectory of ASPs, smartphones are now a very realistic option to connect those billion users.”
The quick drop in prices is often attributed to Android’s open source software, which paved the way for companies like Samsung, ZTE, Xiaomi and even Motorola to offer new smartphones at budget-friendly prices. But Nokia has also targeted the emerging markets with its line of Asha devices and cheaper Lumia phones, while Mozilla recently launched its own Firefox OS with the same strategy in mind. The battle for smartphone market share in much of the world is just heating up, that’s for sure.