Canalys is forecasting that 2019 smartphone shipments are likely to be more than 3% down on 2018 numbers, at 1.35B units.

However, what is bad news for some brands could prove an opportunity for others, suggests the market intelligence firm …

The reason for the projected slump is the ongoing US/China trade war, with Huawei being worst-hit.

Huawei has already been cutting orders and rethinking its goal of overtaking Samsung as it faces the prospect of a much larger fall in its own 2019 smartphone shipments.

Canalys’ base assumption is that restrictions will be imposed stringently on Huawei, once the 90-day reprieve expires, having a significant impact on its ability to roll-out new devices in the short term, especially outside of China. Canalys anticipates that Huawei is taking steps to mitigate the effect of component and service supply issues, but its overseas potential will be hampered for some time. The US and China may eventually reach a trade

But while the Chinese brand will suffer more than most, the one lesson with trade wars is that there are no winners, only losers. Most of the world’s major smartphone brands do at least some of their manufacturing in China, and almost universally rely on Chinese components, meaning that all brands are likely to be hit to some degree.

Smartphone makers are already struggling in a market in which people are holding onto their phones for longer between upgrades.

There could, though, be good news for Samsung, at least for a time.

And demand for 5G is expected to start taking effect in 2020, fuelling demand for new models.

A few 5G smartphones are already available, but very limited network rollout means that demand will be limited until next year. Apple is expected to throw its own weight behind 5G with its 2020 iPhones.

“Smartphone fatigue and a lack of meaningful innovation are still major market forces. Consumers are holding onto phones for longer. But as device lifecycles move toward a new equilibrium point, the rate of quarterly shipment decline will ease,” added Doshi.

Photo: Shutterstock

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