Cape Town - Falling prices are spurring on smartphone growth in the Middle East and Africa, an international survey has found.
According to research from the International Data Corporation (IDC), 2014 saw a record 83% growth in smartphones in the region, resulting in a market share of 41.9% for the gadgets over feature phones.
Price is proving to be a deciding factor as the data shows that feature phones declined by 4.5%. The researchers say cheaper smartphones priced below $100 are making a dent in this price sensitive market.
Phones priced between $100 and $200 saw a surge from 25% to 33% market share.
"Many new vendors have been eager to get into the region's burgeoning smartphone space, with a number of them launching phones in this growing price band," said Nabila Popal, IDC's research manager for handsets and display solutions in the Middle East and Africa.
Even premium manufactures such as Samsung and Sony are eyeing this growing market segment and have launched devices to compete with the like of Hisense, Huawei and Mobicel in SA.
However, more expensive handsets in the $250 to $500 price bracket fell from 23% to 18% market share over the same period.
The result is bad news for high-end devices from HTC, Sony and Samsung.
Cost plays a major role in the adoption of smartphones in Africa. (Duncan Alfreds, Fin24)
"This strategy of targeting the mid and low end of the market has contributed significantly to the success of vendors like Huawei and Lenovo," said Popal.
The IDC also found that dual SIM technology is driving demand for smartphones in the region.
"Vendors such as Samsung and HTC launched variants of their flagship S5 and HTC One M8 models with dual SIM capabilities," said Isaac Ngatia, a senior research analyst at IDC Middle East, Africa and Turkey.
Huawei and Hisense have long offered dual SIM smartphones in SA, but have faced distribution difficulties as operators are generally reluctant to range these devices.
However, the technology is proving popular in the rest of Africa.
"Demand for such devices stems from the fact that a growing band of consumers want to enjoy cheap cross-network calls and offers from multiple telcos and therefore retain more than one SIM card for their personal use," Ngatia added.
Key African markets experienced massive growth in smartphones, the IDC said. Nigeria hit 135% followed by Kenya at 112%, though that was off a relatively low base.
The deployment of 3G has also had a dramatic impact on smartphone growth in Pakistan.
"The increased appetite for smartphones in Pakistan is being driven by a combination of the deployment of 3G networks across the country and the wider availability of more affordable devices," said Popal.
One stand-out in the premium sector has been the growth of Apple's iPhone in the region at the expense of Samsung in the premium sector.
Apple's devices in the region grew by 58% versus only 3.8% for Android devices.
"Apple's growth is primarily due to the incredible success of its iPhone 6 and iPhone 6 Plus models, which finally placed the vendor in the large screen size segment that had previously been dominated by Samsung," said Popal.
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