Australian smartphone market softens as consumers await 5G devices

Australian smartphone market softens as consumers await 5G devices

Consumers put off by high costs

Credit: Dreamstime

Sales of smartphones in Australia are expected to soften in 2019 as consumers hold off buying a new device until 5G becomes available, according to research firm Telsyte.

The Telsyte Australian Smartphone and Wearable Devices Market Study 2019 estimated 4.6 million smartphones were sold in the second half of 2018, down three per cent from the same period in 2017.

Last year saw Apple lose ground to Android; currently 9.1 million Australians are using iPhones while 11 million have Androids, a respective rise from 8.6 and 10.3 million at the end of 2017. Samsung, Oppo and Huawei now lead the Android market.

According to the report, a quarter of consumers will buy a new smartphone when mobile 5G is rolled out, while a third cited it as an important factor when choosing a device.

As such, the researcher forecasted that nine million new smartphones will be sold this year, rising by just one per cent compared to 2018, as only a small number of Android vendors are expected to release 5G smartphones in 2019.

However, should Apple release a 5G iPhone in 2019, Telsyte said this could lift total sales to 9.4 million, leading to roughy six per cent growth.

“There is a clear imperative for carriers to bring 5G handsets to market as soon as possible given the lengthening of the replacement cycle,” Telsyte managing director, Foad Fadaghi said.

In addition to 5G anticipation, the rising cost of buying a new smartphone has also hampered consumer interest.

According to Telsyte, the average selling price (ASP) of smartphones went up by 13 per cent between 2017 and 2018, impacting consumer demand.

Despite lower sales, Apple still maintains the highest repeat purchase intention rate at more than 85 per cent, with the next highest being Samsung at around 70 per cent. The report also noted that smartwatches and smart speakers gained popularity in 2018.

An estimated 1.1 million smart wrist wearable devices - combined smartwatch and smart bands - were sold in the second half of 2018, 30 per cent higher than during the same period in 2017.

Apple currently leads the smartwatch and wearable market, followed by Fitbit and Garmin.

Telsyte also estimated that 1.6 million people were using smart speakers, such as Google Home, Amazon Echo and Apple HomePod, at the end of December 2018, up from 538,000 in 2017. Google currently commands a 72 per cent share of main smart speaker market.

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Tags AustraliaAppleAndroidsmartphonetelsytewearable

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