The Mega Economy that is Smartphone Market

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The days when natural resources are outrightly responsible for the largest share of the economy are over; now technology contributes a lot to that quota

In a recent infographic shared by Statista– reports shows that the smartphone economy has grown from a mere multi-million dollar economy to a trillion-dollar economy, allowing for big smartphone brands to rake in many billions year-in-year-out.

In the recent decade, mobile business has taken a new turn, one that means more money for the respective brands that are into the production of smartphones. Some of the mobile brands that have made enormous fortunes from hardware products include the likes of Apple, Samsung, Huawei, Xiaomi, among several others.

Apple, for instance, recently turned a trillion-dollars company, although not strictly based on the sales of hardware, however, that contributed to the company’s enormous achievement in recent times. Samsung’s network currently stands at $295 billion, while the market capitalization is valued at $326 billion.

Modern mobile brands like Huawei, Xiaomi, and Vivo are also doing well for themselves as they are currently valued at $105.1 billion (with a net profit of $8.7 billion), $85 billion, and $66 billion respectively.

Infographic: The Trillion-Dollar Smartphone Economy | Statista
Image Source: Statista

Taking a look at the image above, Deloitte— a US-based multinational professional services network– estimates the combined smartphone and smartphone multiplier market to be worth $944 billion in 2020, that’s almost a trillion dollars valuation, all of which comprises “a wide array of products and services, including hardware (e.g. cases, chargers, audio accessories, wearables), content (e.g. mobile ads, streaming subscriptions and most importantly apps) and services (e.g. repairs, insurance, cloud storage), and could soon eclipse actual handset sales as the biggest revenue driver in the smartphone economy.”

In recent times, there are more smartphone brands other than Nokia, Microsoft, Samsung, and Apple– all of which are the frontier in the mobile industry. In the wake of modernization, a lot of brands have sprung out of the blue, and surprisingly, taking over the mega economy that is the smartphone market. A very good example of those brands that have really strived to make an impact in the modern mobile market includes the Huawei brand, Xiaomi, oppo, Tecno, among several others.

At the moment, there appears to be a smartphone slump, especially for the devices with the next-gen connectivity- 5G Phones. In another report by Statista, there is an ongoing ‘pre-5G slump in the smartphone market’, although, might not last for a very long time. An IDC estimation indicates a potential boost or perhaps a return to (modest) growth sometimes in 2020.

Additionally, the arrival of 5G smartphones is expected to steer up a desire for upgrade among smartphone users, considering that smartphone innovation has rather been on a stall for a while now, and giving a breakout of the stagnancy–the purchase for new device might just skyrocket in the coming year.

On that note, IDC projected 8.9 percent of global unit shipments for 5G smartphones by 2020 and for nearly 30 percent of total shipments by 2023.

“The anticipation of 5G has been building for quite some time but the challenges within the smartphone market over the past three years have magnified that anticipation,” IDC notes, adding that “we don’t think 5G will be the savior in smartphones, but we do see it as a critical evolution in mobile technology.”

 

 

 

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