IDC’s forecast of the state of the global smartphone market in 2020 – a 10.6% drop in the first half of the year

IDC’s forecast of the state of the global smartphone market in 2020 – a 10.6% drop in the first half of the year

IDC’s forecast of the state of the global smartphone market in 2020 – a 10.6% drop in the first half of the year

News unit IDC Research Institute on Thursday, February 27, 2020 (March 8, 2018) with publishing a report on the institute’s main website, announced its forecast of the state of the smartphone market in 2020. The return of growth to the global market – which for 2020 Predicted – currently affected by uncertainties related to the increasing spread of the new corona virus (known as COVID-19) has been placed and may not be realized soon. According to this report, the total volume of smartphones sold in the market this year reaches a little over 1.3 billion devices, and with this account, the global market is expected to suffer a drop of 2.3% in 2020.

IDC experts believe that the outbreak of COVID-19 will lead to a 10.6% annual decline in smartphone shipments in the first half of 2020. Of course, with the acceleration of 5G technology, the global market will return to growth in 2021. The uncertainties surrounding the COVID-19 virus have led IDC to consider optimistic, possible, and even pessimistic scenarios for the market. IDC’s current forecast is aligned with the likely scenario. According to this scenario, thanks to the gradual return of Chinese workers to factories (despite challenges in the transportation category), the production and logistics market trends are expected to improve within the next few quarters.

Most likely, the shock caused by the decrease in demand in the Chinese market will continue for several seasons, but with the help of government incentives and subsidies, this shock will be somewhat reduced by the end of the year. According to IDC experts, the state of smartphone supply in the global market will begin to improve from the second half of 2020, which can be considered a U-shaped phenomenon. But the actual release of the phones – taking into account the seasonal nature of the releases – could have a different shape.

According to Sangeetika Srivastava, senior research analyst at IDC, the COVID-19 virus is another reason for the current market volatility to continue and weaken its growth in the first half of the year. Undoubtedly, China, which is considered the largest smartphone market in the world, will suffer the most from the current situation, but other large geographical areas will not be spared from supply chain disruptions. Lack of parts, closure of factories, quarantine order, logistics and restrictions on travel are among the obstacles that make smartphone sellers face problems in the production of phones and the supply of new devices. Srivastava expressed hope that from the third quarter of this year, following the improvement of the dire conditions caused by the new corona epidemic and the acceleration of the expansion of 5G plans around the world, the proposed scenario will be stabilized.

Changes in the smartphone market forecast between 2020 and 2021

The months of January and March are when manufacturers unveil their most important flagships and perform pre-production tests. , they are taking action to fix the defects of the products that are going to enter the market in the first half of the year. Now, the current special conditions have caused a change in the plans of companies to release their products in the first half of the year, and this will most likely affect the release of companies’ products in the medium and even the long term.

Will Wong, research director of consumer devices in the Asia/Pacific division of IDC, in his prediction of China – which is considered to be the epicenter of the Corona earthquake – estimated that the domestic market of this country during the quarter First of 2020, it has dropped by about 40% compared to the same period last year, and even if we optimistically imagine that the situation will improve in March, it will still be difficult to reach the level that the market was at last year. According to Wang, consumers prefer to make their purchases through online sales channels. These purchases accounted for a significant double share of phones sold in the first half of 2020 and may change consumer purchasing behavior forever.

Difference in mobile market forecast for 2020 in November 2019 and February 2020

The outbreak of the corona epidemic will weaken the foundations of the Chinese economy. In the meantime, many small and medium enterprises have suffered the most losses and the result will be a decrease in the purchasing power of consumers. According to IDC experts, in this turbulent market, the business of small and medium-sized enterprises active in the mobile industry – especially retail channel partners – will be affected more than others. On the other hand, mobile sellers who can effectively help improve their sales channel and other partners and consolidate their business after the end of the epidemic, will have more opportunities for growth in the long run.

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