Smartphone prices jump 10% and global market revenue dips 3%
By Jeph Ajobaju, Chief Copy Editor
Smartphone prices rose 10 per cent worldwide in the third quarter of 2022 (Q3 2022) and out of reach for many in regions with historical low penetration in the Global South which includes Nigeria
Counterpoint Market Monitor Service says its new research shows the increase was driven in part by record shipment of 5G handsets which cost five times an average non-5G phone.
“The global smartphone handset market’s revenue declined three per cent YoY (year-on-year) in Q3 2022 to just above $100 billion, according to the latest research from Counterpoint’s Market Monitor Service.
“A 10 per cent YoY growth was seen in the average selling price, thanks to the premium handset segment’s greater resilience to economic uncertainty,” the report said, per The PUNCH.
“The record shipment contribution (46 per cent) of 5G handsets, which cost five times an average non-5G handset, also added to the ASP [average selling price] and revenue growth.
“In terms of shipments, the overall handset market saw a 12 per cent YoY decline during the quarter.”
Senior Analyst Harmeet Singh Walia said: “At over $80bn, the revenue contribution of 5G handsets reached an all-time high of 80 per cent of global handset revenues, up from 69 per cent in the third quarter of last year.
“In the same period, LTE handsets’ revenue contribution fell 10 per cent to $19bn.
“This shift from 4G to 5G has been led by Apple, which alone makes up for over half of all 5G revenues as over 95 per cent of its phones are 5G-enabled.
“Apple saw a 10 per cent YoY revenue growth and seven per cent YoY ASP growth in Q3 2022, contributing to an overall increase in global handset ASP.”
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Smartphone affordability
The launch of the iPhone 14 series and the Pro models, especially from the previous generation, drove the increase in Apple’s revenue.
Smartphone affordability is one of the major barriers to Internet and connectivity access.
Alliance for Affordable Internet [AAI] has noted the average cost of a smartphone is about 37.46 per cent of the average monthly income of a Nigerian, according to reporting by The PUNCH.
AAI said 2.5 billion people globally still pay more than 30 per cent of their monthly income to purchase the cheapest smartphones available in their markets.
Smartphones have enabled digital participation, it stressed, but they are largely unaffordable globally, especially in low-and-middle-income countries.
“At present, countries are not doing enough to better understand what can be done to improve smartphone affordability,” AAI said.
It disclosed only about 44 per cent of Nigerians own smartphones.
IBM Global Telecommunications Industry Vice President Craig Wilson told The PUNCH “a sweeping majority of Nigerians lack access to smartphones with 4G-like speeds for Internet connection and the capacity to use the Internet on a daily basis, according to the Alliance for Affordable Internet.”
The high cost of 5G devices would impact rollout plans in the country, he said, as “the cost of a 5G device currently runs around $350, making them unaffordable for many.”
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