Africa's biggest markets drive strong growth in smartphone shipments. Photo: AP

JOHANNESBURG – South Africa remains the continent's most developed telecommunications market, with smartphone shipments up 17.4 percent year on year in in the second quarter to total 3.4 million units. 

Arnold Ponela, a research analyst at IDC said: "Numerous new entrants to the South African market are now offering affordable smartphones that boast very similar features to the leading brands," said Ponela. "As such, we expect the country's migration away from feature phones to continue at a progressive pace. This transition from feature phones to smartphones is reflected by the fact that the market continues to be dominated by low-end to mid-range devices priced below $150."

A total of 22.4 million smartphones were shipped in Africa during the second quarter of this year, according to the latest insights from International Data Corporation (IDC). 

The global technology research and consulting firm's Quarterly Mobile Phone Tracker shows that Africa's smartphone shipments increased 9.8 percent quarter on quarter and 6 percent year on year in this year’s second quarter.

The market's buoyant performance was spurred by the growing popularity of low-end to mid-range devices. Transsion brands continued to lead the continent's smartphone space in the second quarter, accounting for 35.4 percent of shipments. Samsung followed in second place with a 23.2 percent share.

By contrast, the feature phone market was down 1.1 percent quarter on quarter and 5.8 percent year on year in the second quarter, but – with shipments totaling 31.4 million units – these devices still constitute a 58.3 percent share of Africa's overall cellphone market as they cater to the needs of the continent's huge low-income population by providing basic mobile communications that are priced very competitively. 

Biggest markets

Looking at the overall picture, the region's combined mobile phone market totaled 53.8 million units in the second quarter, with shipments up 3.2 percent quarter on quarter but down 1.2 percent year on year. The continent's two biggest markets – Nigeria and South Africa – saw a marked improvement in the performance of their overall mobile phone markets, posting year-on-year growth of 13 percent and 25 percent, respectively.

"The Nigerian economy remains stable and has begun to show signs of steady improvement in terms of consumer demand for mobile phones," said Ponela. "The country saw smartphone shipments of 2.7 million units in this year’s second quarter, up 15.8 percent year on year, with strong marketing support from telecom operators for most brands proving instrumental. However, ongoing currency issues and falling consumer purchasing power suggest Nigeria is not set for a sustained surge in smartphone shipments."

IDC's research shows that 4G LTE networks are spreading their reach in Africa, with shipments of 4G LTE devices increasing 11.8 percent quarter on quarter in in the second quarter to constitute 62.6 percent of the smartphone market. "Despite a drop in the prices of entry-level 4G phones, 2G and 3G mobile devices remain far more economical, making it difficult for operators to migrate clients over to newer technologies," said Ramazan Yavuz, a research manager at IDC. "Price sensitivity means that many African consumers prefer to stick with 3G phones, and this is likely to continue until 4G devices fall to a price point where they are affordable to a much larger segment of the continent's consumer base." 

Looking ahead, IDC expects Africa's overall mobile phone market to grow 2.6 percent quarter on quarter in this year’s third quarter, with overall shipments to increase slightly through 2018, leading to year-on-year growth of 0.4 percent for the year as a whole. "IDC predicts that 5G phones will reach the market in 2020, when rollouts of 5G networks will start in select African countries," said Yavuz. "However, demand for feature phones is unlikely to be impacted significantly as these devices will continue to serve a purpose in areas with no LTE coverage."

– BUSINESS REPORT ONLINE