Trends to watch at IFA 2023 and Omdia’s 2024 Smartphone Market Outlook

The smartphone market has seen a few key developments over the past few years. The technology is well into maturity, with large innovations being few and far between and many OEMs converging their flagship into a similar set of specifications.

The industry has also been under a lot of pressure. Following a boom in demand over pandemic lockdowns, COVID-regulations have squeezed supply lines and inflation has decreased consumer demand.

But there is plenty for the smartphone industry to look forward to, from economic recovery to exciting new technology, and moving towards a clean and safe transition to a more sustainable industry.

Smartphone shipments should recover in 2024

Omdia’s preliminary data shows global smartphone shipments continue to decline year-on-year. 2Q23 marks the eighth consecutive quarter, down 9.5% from 2Q22. Higher demand over the pandemic is partly to blame, but so are key component supply issues and shrinking consumer demand amid high inflation.

Many of these will ease over time and demand should recover in 4Q23 and into 2024, as reduced inflation stops squeezing on wage packets and as high inventory levels are tackled by OEMs. While 2023’s total shipment figures are still likely to be lower than 2022, a strong end of the year should set the industry up for success in 2024.

Foldables are maturing but still a long way to go

Samsung and Honor’s latest foldable phone announcements have shaken up the smartphone industry. A clear technological race is happening in foldable phones to make them thinner and more lightweight – key consumer obstacles to adopting foldable tech.

It’s clear that as foldables mature as a technology, and when prices come down, more consumers are likely to make the switch therefore intensifying the competition for market share as Samsung battles it out with not just Honor, but other Chinese OEMs such as Oppo, Xiaomi and Huawei.

More sustainability regulations are expected

The EU commission has led the world in developing eco-design and right-to-repair legislation. The biggest thus far has been mandating that all phones use USB-C type connectors. This adaption will come into play in 2025, with iPhones expected to make the switch to USB-C either for the 15 series or 16 series.

Recently the European Parliament also voted through regulation which will come into force in 2027, and require phones to have replaceable batteries. The hope for this is to extend a phone’s useable life and reduce phone production and waste to reduce environmental impact.

However, very few brands are ready for this. Nokia and Fairphone are the only phone brands to have a consumer repairable smartphone. Therefore, many smartphone brands that sell in the EU will need to consider how they approach the market – either making repairable phones specifically for the EU or making all phones they sell globally repairable.

A new monthly digest for the smartphone market

Omdia has developed a new monthly digest to help OEMs, app developers, media brands and component manufacturers navigate the everchanging and fast-paced smartphone market.

Our new Smartphone Need-To-Know is a monthly news digest on the key “need-to-know” developments happening in the smartphone industry, along with expert analyst opinions on what it all means, including:

• New product announcements
• Regulatory developments
• Supply chain dynamics
• Market shifts

 Find out more and sign up for this digest here.