Worldwide Smartphone Shipments To Reach 1.2B In 2014 With Android Continuing To Be The Market Leader

Worldwide shipments of smartphones are expected to almost double over the next four years with Google Inc.’s (NASDAQ:GOOGL) Android remaining the market leader among mobile operating systems while Microsoft Corporation’s (NASDAQ:MSFT) Windows Phone continues to slowly build a global footprint, according to a new report from International Data Corporation, or IDC.

IDC said in the report that worldwide smartphone shipments will reach a total of 1.2 billion units in 2014, marking a 23.1 percent increase over the 1 billion units shipped in 2013. The market research firm also stated that total volumes are expected to touch the 1.8 billion mark in 2018, resulting in a 12.3 percent compound annual growth rate, or CAGR, from 2013 to 2018.

“Smartphone shipments will more than double between now and 2018 within key emerging markets, including India, Indonesia, and Russia,” Ramon Llamas, research manager with IDC's Mobile Phone team, said in a statement. “In addition, China will account for nearly a third of all smartphone shipments in 2018. These – and other markets – will offer multiple opportunities to vendors and carriers alike, but the key will be balancing affordability with expectations.”

According to IDC, Android will continue to be the market leader among mobile operating systems with its share expected to hit 80.2 percent in 2014. However, it could lose a tiny sliver of market share over the next four years, as Windows Phone grows in popularity.

Shipments of smartphones running Windows Phone are expected to reach 43.3 million in 2014, representing a growth of 29.5 percent over 2013. That momentum is likely to continue into 2015, reaching 65.9 million units and hitting the 115.3 million mark in 2018.

As for Apple Inc.’s (NASDAQ:AAPL) iOS, IDC expects its share to drop from 14.8 percent in 2014 to 13.7 percent in 2018, despite rumors of a larger screen iPhone 6. Shipments of iPhones are expected to hit 184.1 million in 2014 and grow to 247.4 million in 2018, a growth of about 34 percent. Although iOS is expected see a growth of 20 percent this year, that number is projected to slow down to an annual growth of only 6.1 percent in 2018.

Meanwhile, IDC continues to reduce its forecast for BlackBerry Ltd. (NASDAQ:BBRY) across the board with shipments expected to drop 49.6 percent in 2014, reaching 9.7 million units. The company’s shipments are expected to continue to decline to 4.6 million units in 2018.

Decline In Average Selling Price

As smartphones grow even more ubiquitous, IDC expects the overall average selling price, or ASP, of smartphones to reach $314 in 2014 and fall to $267 by 2018, compared to an ASP of $335 seen in 2013. At the same time, customers can continue to expect a high-end user experience regardless of the smartphone being used, IDC said.

“Until recently, low cost has equaled poor quality in the smartphone space,” Ryan Reith, program director with IDC's Worldwide Quarterly Mobile Phone Tracker, said in the statement. “Given the competition at the high end, vendors like Motorola are trying to skate to where the puck is going by offering extremely affordable devices like the Moto E, which offer a ‘good enough’ experience that will suit the needs of many.”