Worldwide Device Shipments Will Decline 0.3 Percent in 2017

Worldwide shipments of PCs, tablets and smartphones are expected to exceed 2.3 billion units in 2017, a decline of 0.3 percent from 2016, according to Gartner. The market is forecast to return to growth in 2018 with a 1.6 percent increase in shipments.

Worldwide Device Shipments by Device Type, 2016-2019 (Millions of Units)

Device Type

2016

2017

2018

2019

Traditional PCs

220

203

195

191

Ultramobiles (Premium)

50

59

72

82

PC Market

270

262

267

272

Ultramobiles (Basic and Utility)

169

160

159

158

Computing Device Market

439

424

427

432

Mobile Phones

1,893

1,904

1,936

1,934

Total Device Market

2,332

2,326

2,362

2,363

Source: Gartner

PC shipments are on pace to drop 3 percent in 2017, but the rate of decline is slower than in recent years, alleviated by Windows 10 replacement purchasing. Prices for components such as DRAM memory and SSD hard drives continue to rise, creating headwinds for the global PC market and, to a lesser extent, the smartphone market. The impact of component pricing on PCs is being reduced for buyers as producers absorb some of the cost into their margins, fearing the alternative of a reduction of their share of a competitive market.

Overall smartphone shipments will grow 5 percent in 2017, reaching nearly 1.6 billion units. End-user spending continues to shift from low-cost "utility" phones toward higher priced "basic" and "premium" smartphones. The smartphone market is now more dependent on new devices that offer something different, as users are extending their purchasing cycles and need to be enticed to make a replacement.

The "basic" smartphone market is expected to record 686 million shipments in 2017, up 6.8 percent from 2016. "Consumers have already accepted the greater value attained from the better capabilities of basic smartphones, compared to low-end utility devices. Therefore, the average selling prices of mid- and high-range smartphones continue to increase," said Ms. Cozza. "The Chinese players currently pushing basic smartphones with premium feel and features into the market will continue to strengthen the shift away from low-end utility phones toward basic smartphones."

The total installed base for these devices is currently around 7 billion units, so vendors are constantly looking at ways to add new capabilities that can give their products an edge in the market. Many new technologies, such as artificial intelligence (AI) and virtual personal assistants (VPAs), will grow in adoption throughout the forecast period, yet it is difficult to see any revolutionary impact in early iterations.



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