Mobile device revenues up 17% in Q1 2015 – Chinese suppliers surge

I’ve been busy adjusting my mobile device model to accommodate the growth of new form factors – ‘Smart Wearables’ and ‘IoT Devices’. although they’re not yet shipping in multi millions, I want to be prepared. In the process I’ve made a number of changes to my smart phone, smart tablet and basic phone research, which I publish here for the first time. You’ll want to think about the implications of these very large numbers.

The mobile device market grew 17% in Q1 2015 to $97b and by 9% in the year to the end of March to $374b. The growth was almost entirely driven by Smart Phones, which grew 32% to off-set a 15% decline in Basic.. and a 16% decline in revenues from Smart Tablets.

The Shipment growth was less than value – in the quarter increasing by 9% to 377m and in the year to 1,588m.

We show shipment market shares for all mobile devices and each of the three contributing sub-markets in the Figure. Because we’re looking at units here, Apple’s lead is less pronounced – although it still has a significant lead over Samsung in both the Smart classes. Samsung now has a significant lead in the Basic Phone market over Microsoft (which includes Nokia’s phone business of course). In the total market a trio of Chinese suppliers – Huawei, Lenovo (now with Motorola’s business via Google) and Xiaomi – sit in positions 4 to 6. They are filling up their home market and beginning to ship much higher priced machines in the USA and Europe.

There are now many more sales of mobile devices each quarter in Asia Pacific than either the Americas or EMEA (see Figure). To a certain extent Western markets are more saturated, making it essential for suppliers to sell extension products, which we’re aiming to capture in our 2 new categories.

When it comes to forecasting the whole market )see main Figure), I’m predicting a healthy market for Smart Wearables and IoT Devices, although I don’t see either of them overtaking Smart Phones – or even Smart Tablets – by 2020.

If ‘people are the product’ in the IT market, then these mobile devices are the main way to access them. As in other areas suppliers will need to group them together for new social applications. If ‘people are the product’ then perhaps they should be paid by the vendors!

As for operating systems – only iOS, Android are ‘industry standards’ today with an installed base of 537m and 1.3b respectively: Windows, with 175m, doesn’t quite make it.