Published On: Thu, Aug 20th, 2015

Peak Android? YoY Growth Lowest Ever In Q2, Says Gartner

It’s no consternation Google is expanding a efforts to broaden Android’s reach by working with OEMs in rising markets, around its Android One smartphone affordability program; a latest tellurian smartphone marketplace information from researcher Gartner shows expansion slowing, and Android privately recording a slowest ever year-on-year growth.

Gartner’s information on Q2 opening of a smartphone marketplace altogether indicates growth is the slowest given 2013, with tellurian smartphone sales to finish users totaling 330 million units in a entertain — an boost of only 13.5 per cent over a same duration in 2014.

The researcher points to a saturated Chinese marketplace for a slack — something it also flagged progressing this summer. The marketplace represented only underneath a third (30 per cent) of sum smartphone sales in Q2 creation it a biggest singular nation for phone sales.

“Its bad opening negatively influenced a opening of a mobile phone marketplace in a second quarter,” records Gartner investigate executive Anshul Gupta in a statement. “China has reached superfluity — a phone marketplace is radically driven by replacement, with fewer first-time buyers. Beyond a lower-end phone segment, a interest of reward smartphones will be pivotal for vendors to attract upgrades and to say or grow their marketplace share in China.”

China’s diseased opening also impacted Android’s growth, joined with Apple’s clever opening in a market, according to the analyst. Gartner records Apple’s iOS has taken share from Android there for a final 3 quarters. (Apple’s introduction of a initial phablet-sized iPhone, a 6 Plus, has clearly helped boost a share in Asia).

Despite a negligence growth, Google’s Android OS still took 82.2 per cent of a tellurian smartphone marketplace in Q2, recording 11 per cent year-over-year growth, by Gartner’s reckoning. While Apple’s iOS took a 14.6 per cent marketshare, adult from 12.2 per cent in Q2 final year — with y-o-y expansion in a shred of 15 per cent, according to Gupta.


Is this rise Android then, in terms of marketshare? “Maybe… this is what we were unequivocally awaiting a max, around 82 per cent,” Gupta tells TechCrunch. “I consider final year it went adult to 83.5 or 84 per cent of a altogether sales.

“Still there is a lot of section expansion left in a marketplace since globally we are awaiting this year smartphones to be around roughly 1.2 billion, 1.25 billion, out of 1.8 billion [mobile devices], so it’s roughly two-thirds that are going to come from smartphones, though afterwards one-third is still left and design Android to say their 80 per cent+ lead in that,” he adds.

Google’s Android One beginning is some-more about pulling some-more Android foe into rising markets to lift altogether handset standards, reckons Gupta, rather than itself being a car for generating outrageous sales volumes.

He notes, for instance, that competitively labelled smartphones already exist in emerging markets where Android One plays. And that several Android OEMs — including Xiaomi, OnePlus and Motorola — are also pushing OS updates directly to users (another Android One feature).

“The market is utterly rival and that’s a reason we haven’t seen any outrageous success entrance in from Android One so far,” he says, adding: “Google is pulling a module since it ensures that a users in those rising markets get entrance to latest phone with latest handling system, so they are bringing in some-more foe in a marketplace that pushes vendors to go for identical kind of offering.”

Turning to particular mobile makers, Gartner’s Q2 report puts Samsung losing 4.3 commission points in marketshare in a quarter, and disappearing 5.3 per cent in section sales — notwithstanding a launch of new Galaxy S6 models. Meanwhile iPhone sales were adult 36 per cent, enabling Apple to carve out an additional 2.4 commission points in marketshare.

Gartner says Apple available clever iPhone replacements in both rising and mature markets, and especially clever opening in China. Total iPhone sales there grew 68 per cent to 11.9 million units.


Why is Apple doing so good in China? It comes down to a energy of a brand, reckons Gupta. “It’s a large code and people unequivocally associate that with their standing and it’s kind of an aspirational code so many of a consumers in China design to possess an iPhone during some indicate of time,” he says.

“To some border it has influenced deputy sales for Android phones since Android users are holding onto their phones for a small longer in a wish of shopping an iPhone… Someone indeed told me in China there are dual kinds of smartphone: one is a iPhone, another is ‘all a phones’.”

And nonetheless China’s smartphone marketplace as a whole is saturating, Gupta says there’s still room for reward smartphone expansion there — that still accounts for less than 20 per cent of a market. Giving Apple room to continue flourishing the iPhone’s share in China.

“Apple sole roughly 7.5 million phones final entertain out of 102 million, or maybe 98 million, so that is closer to 8 to 9 per cent. Overall reward could be roughly around 20 per cent so that shred is still one-fifth of what a altogether marketplace is,” he adds. “So if that shred grows there are unequivocally some-more quantities for Apple.”

Apple’s double-digit Q2 expansion caused headaches for rivals in a high-end segment, negatively impacting their reward phone sales and distinction margins, with Gartner observant that many vendors had to realign their portfolios to sojourn rival in a midrange and low-end smartphone segments — triggering price wars and discounting forward of device refreshes designed for a second half of a year.

tl;dr: It sucks to be an Android OEM trying to make income from an Apple-style hardware margins focused business indication right now. (Just ask HTC.)

“The marketplace is very, unequivocally competitive. A smartphone has kind of turn a commodity. And split is unequivocally very, unequivocally challenging,” says Gupta. “That’s since some of a brands, like if we demeanour during Xiaomi, they are perplexing to compute by a services. Where they’re charity disdainful calm onto their devices.

“It also comes down to formulating an ecosystem, with other consumer products that people competence be meddlesome in, like health bands or watches or other kinds of accessories. So it unequivocally helps to build an ecosystem around your product.”

“Those who unequivocally unsuccessful to renovate or who unsuccessful to unequivocally know marketplace dynamics have suffered. So it’s a reason for a disaster of HTC or Samsung — they couldn’t unequivocally know how a markets are changing and a mature markets, as good as in a rising markets. And that’s a reason they are struggling to grow their marketshares,” adds Gupta.

Despite extreme foe in a space, Gupta says Android’s low separator to entrance will continue to inspire “an array of new players” — privately he predicts “further disruptions” entrance from Chinese production and Internet players focusing on new business models that aren’t reliant on hardware margins. The reason being there’s still copiousness of untapped marketshare in many rising markets for smartphone growth.

“There is a lot of expansion left in that space that unequivocally attracts other players to come into these markets — nonetheless meaningful that it is unequivocally formidable to make distinction in this market, since there are too many players already. But we consider it is only a perfect volume that attracts these brands to come into a marketplace and try their hand,” he adds.

“Just demeanour during how Xiaomi has remade themselves in a final 3 or 4 years. They were a series one actor in China, they’ve come into India turn series 5 actor in no time, reduction than a year. So some of these players have successful exploited a quantities in these markets.”

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