Powered by the rise of cheap smartphones, declining data prices, and short replacement cycles, the smartphone industry has seen rapid adoption for the past 10 years. But after years of consistent double-digit growth rates, we expect the number of global smartphone unique subscribers to grow by single digits in 2018 for the first time, at 9.1%. The number of global smartphone unique subscribers will surpass 3 billion in 2018, with a penetration rate of 55% of the population. It is now becoming difficult to add new subscribers globally, and there are very few countries that can do this. However, smartphone manufacturers still have a very large opportunity. Based on the Forrester Data: Mobile, Smartphone, And Tablet Forecast, 2017 To 2022 (Global), we divide the smartphone opportunity into three parts:

  • Transitional. In these countries, mobile penetration has already reached a mature level, the opportunities to add new subscribers are limited, and the increase in the number of smartphone subscribers comes from the transition of feature-phone users to smartphones.
  • Replacement. These countries have an advanced telecom market and a significant number of subscribers owning more than one smartphone; device replacement offers an opportunity for handset manufacturing companies.
  • Incremental. Here, the increase in smartphone subscribers is due to both new subscribers and the transition of feature-phone owners to smartphones. These countries are the focus of handset manufacturing companies: Argentina, Brazil, Bulgaria, Chile, China, Colombia, Egypt, India, Indonesia, Mexico, Nigeria, Peru, Philippines, Poland, Turkey, Venezuela, and Vietnam.

How Big Is The Incremental Opportunity?

Globally, smartphone subscribers surpassed feature-phone subscribers in 2014, but more than a billion feature-phone subscribers provide a large, untapped market for low-cost smartphone manufacturers. Of the 1 billion new smartphone subscribers that we expect to be added by 2022, the “incremental opportunity” countries will contribute 852 million (see Figure 1). This will include subscribers shifting from feature phones to smartphones as well as new subscribers buying smartphones directly and skipping the feature phone altogether. We expect to see significant disruptions in the next five years in eCommerce, mCommerce, digital advertising, social media, retail, mobile payments and banking, and content as the smartphone becomes the preferred channel for online transactions.

Related Forrester Research

Forrester Data: Mobile, Smartphone, And Tablet Forecast, 2017 To 2022 (Global)