Research Group IDC Raises Worldwide Smartphone Market Projections by 10%

The worldwide market for smartphones is expected to grow 55.4% this year compared to 2009 amid greater-than-expected demand for the do-it-all devices. This is 10% higher than the previous forecast from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker. IDC now expects mobile phone vendors to ship 269.6 million converged mobile devices this year compared to the 173.5 million units shipped in 2009. The increased market forecast for smartphones comes amid the launch of several new models, such as the BlackBerry Torch, EVO 4G, and the iPhone 4, in recent months.

“The smartphone is the catalyst behind the rebound in the worldwide mobile phone market this year,” said Kevin Restivo, senior research analyst with IDC’s Worldwide Quarterly Mobile Phone Tracker. “Additional product introductions and an expected flurry of smartphone buying activity in the second half of the year will push the market well above previous expectations.”

For the first half of 2010, vendors shipped a total of 119.4 million units or 55.5% more than the 76.8 million units shipped during the first half of 2009.

“As the worldwide smartphone market continues to grow at a strong rate, the market dynamics among mobile operating systems continue to shift,” said Ramon Llamas, senior research analyst with IDC’s Mobile Devices Technology and Trends team. “Longtime operating systems leaders BlackBerry, Symbian, and Windows Mobile are about to or have already launched refreshed operating systems to compete with recent newcomers Android and iOS. The latter operating systems have taken away both mindshare and market share from the old regime, and have helped propel the market forward.”

“Android is the wild card, deserving close observation for the rest of this year and the years to come,” added Llamas. “Phone vendors have been drawn to Android because it allows them to present their own approach to what a smartphone experience can be. In addition, users have quickly warmed to Android, comparing it to iOS due to its ease of use and a growing mobile application storefront. Now that HTC and Motorola have leapt out in front with their own respective devices, other vendors such as Dell, Kyocera, LG Electronics, and Samsung will soon help grow the Android market.”

The accelerated smartphone growth will translate into a better overall market performance this year. IDC now expects the 2010 overall mobile phone market to grow 14.1%, or 1.5% higher than its previous forecast. Last year, the market declined 2.8%, the first such occurrence in Mobile Phone Tracker history.The outlook for 2011 is also very strong. Despite uncertainty about the economy, the smartphone market is expected to increase 24.5% in 2011. However, smartphone growth will decline progressively over the course of IDC’s five-year forecast period. In 2014, for example, the market is expected to rise by just 13.6%.

Nonetheless, there is ample room for multiple players to grow. No one smartphone OS will dominate mobile phones in the way that Microsoft has with Windows on the personal computer. “IDC believes the market will comfortably support up to five OS players over the next five years,” Restivo noted. “Shorter replacement cycles and an ample feature phone to smartphone upgrade opportunity means the smartphone OS market will remain fragmented but healthy for the foreseeable future.”

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