Is the Smartphone revolution over? What is the future of the mobile telecommunications world?
That is the question we ask today.
It’s been almost a decade since Apple launched the original and famous iPhone which shook the mobile phone industry’s foundations.
Apple's arrival in the market caused major market share loss for the first smartphone companies such as Nokia and Microsoft, which weren’t able to face the new kid on the block, despite concerted efforts.
Apple was and always has been the most innovative of the competitors.
This revolution allowed Apple to turn into the most profitable and valuable company in the world (representing US$620bn this past week).
iPhone Evolution, from iPhone 1 to iPhone 6
A few months ago, the iPhone sales growth grew slowly into decline: Apple's first revenue decline in 13years.
Today, the revolution brought by the iPhone is supposedly over - according to the mobile industry's experts.
The tech industry witnessed Apple's once rapid innovation stumbling into a slower and slower rate, forcing users to wait longer to upgrade their smartphones.
Obviously, there is still a constant and strong growth in the developing sub-Saharan Africa, but the demand is for low-cost smartphones, not high-innovative ones that have been the field’s main profit driver and eye-candy.
This growth in sub-Saharan Africa will remain important, but mainly for affordable low-cost smartphones. Here we talk about devices from Chinese brands and white-labelled smartphones from telecom operators like Vodacom and MTN.
“The smartphone is reaching maturity; incremental innovation is slowing down.” said George Kalebaila, research manager at International Data Corp (IDC) in Johannesburg in August 2016.
George Kalebaila
*Incremental innovation is a series of small improvements to an existing product or product line that usually helps maintain or improve its competitive position over time. Incremental innovation is regularly used within the high technology business by companies that need to continue to improve their products to include new features increasingly desired by consumers. * (Def from Business Dictionary)
In fact, can we say that the industry is stopping in its tracks like the PC industry in the previous decade? “Definitely”, said Kalebaila. “There is not much of a surprise in new phones anymore. (…) The products have become standardized, as it were.”
The appetite of the public that used to arrive before launches, when every smartphone came with new features, has decreased, he said. And the fact that older phones receive the latest software updates reduce the need for hardware change.
The experts as Brian Neilson for example, predict that 2017 will be known for an almost flat growth in shipments, he also said that the decrease in iPhone sales is a sign of what will probably come.
Nowadays, functional improvements have taken the place of the revolutionary features and design innovation we saw in the past.
The South-African market is more mature than the rest of Africa. Smartphones will scale up almost 60% of device shipments in 2016. According to IDC Research, this figure will reach 82% by 2020.
In the next five years, shipments of feature phones (older ones) are supposed to decline by 15% per year in South Africa, while smartphone shipments will rise by 9% per year (low-end devices).
Other smart devices will provide a significant new revenue stream for manufacturers in the next years (especially the ones linked to health and fitness). Advanced technologies such as virtual reality google glasses will probably remain luxury goods, not affordable for anyone for the foreseeable future, explained Kalebaila.
The article is inspired by the Sunday Times.