Smartphone Sale Prices Rising As Demand Drops In Q1 2018: GfK

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Global smartphone sale prices are rising in a significant manner as the demand for contemporary handsets is declining, according to the latest study conducted by market research firm GfK. Over the course of the first quarter of 2018, the mobile industry recorded 347 million sales, two percentage points down annually. At the same time, the average phone selling price grew by 21-percent year-on-year, amounting to $374 per unit, with the trend significantly boosting the segment's revenue which amounted to $129.8 billion during the observed period, 18-percent more than in Q1 2017. The uncharacteristic global smartphone ASP spike isn't necessarily indicative of handset prices rising but more likely implies that consumer interest in entry-level devices is dropping as mid-rangers appear to be closing the gap with flagships, at least in terms of core functionalities that most users are primarily interested in and willing to pay for.

Whereas the mobile industry was breaking sales records a year ago, it's now demonstrating a historic ability to monetize its offerings, the new research suggests. The fact that a maturing segment like the mobile one is capable of such massive revenue gains while attracting fewer customers is "exceptional," GfK's telecom analyst Arndt Polifke said. The latest report is in line with the company's previous estimates and findings, with the firm asserting the global smartphone industry started declining for the first time ever last year, at least in terms of sales, and in spite of positive fourth-quarter results.

While the mobile sector now appears to be making the most of its declining sales, it's unclear whether the current situation is sustainable, with more consumers opting for mid-rangers and flagships over entry-level models but also being keen on holding on to them for longer than they previously did. The onus is now on original equipment manufacturers to deliver enough innovations to incite consumers to upgrade their devices in the immediate future, with the next moves on that front likely coming in the form of 3D cameras akin to the setup found on Apple's iPhone X. In the medium term, the industry is also expected to aggressively push toward foldable handsets which are widely considered to be the "next big thing" in the mobile space and should start hitting the market no later than 2019.

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Dominik started at AndroidHeadlines in 2016. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]

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