Smartphone sales in India decline by 3% owing to rise of 4G feature phones: Gfk report

Reliance Jio started the 4G feature phone trend in India with its low-priced JioPhone.

Smartphone sales in Asia this year are expected to increase by 9% (Getty Images/iStockphoto)

When it comes to smartphone sales, there was a 3% decline in India in the fourth quarter of 2017 owing to a proliferation of low-priced 4G feature phones, like Reliance JioPhone that hit smartphone sales hard, German research firm GfK said on Thursday.

"Emerging Asia saw smartphone sales of 58.6 million units in 4Q17, down one per cent year-on-year," the market research firm said.

"This was dragged by a three per cent decline in India, where a proliferation of low-priced 4G feature phones likely cannibalised smartphone sales," it added.

In 2017, 232.7 million smartphones were sold in the Emerging Asia region, an increase of 8% compared to 2016. GfK forecasts regional demand growth to improve to 9% in 2018.

"The outlook for 2018 is positive as GfK forecasts global smartphone demand to rise by three per cent compared to 2017, driven by Emerging Asia and Central and Eastern Europe," said Yotaro Noguchi, product lead in GfK's trends and forecasting division.

"With saturation in developed markets, consumer retention will be a key focus for smartphone makers, which, alongside increased commoditisation, will encourage greater innovation and differentiation in order to spur sales," he added.

Sales in "Developed Asia" hit 18.5 million units in 4Q 17, a fall of 9% year-on-year, dragged by a 21% decline in South Korea.

Smartphone sales in the region totalled 68.5 million units in 2017, a fall of 6% compared to 2016.

However, GfK forecasts a return to growth of 2% in 2018, driven primarily by improving fortunes in Japan.

Global smartphone sales reached 397 million units in the fourth quarter of 2017 -- a 1% increase year-on-year.

Demand was primarily driven by Middle East and Africa, which experienced 8% growth, and Central and Eastern Europe, where demand grew 7%.

"Smartphone year-on-year demand growth moderated for the fourth consecutive quarter, rising only one per cent to 397 million units in 4Q17.

"However, sales value increased by 11 per cent year-on-year in the quarter, which is exceptional growth for such a mature technology category," said Arndt Polifke, Global Director of PoS telecom research at GfK.