) and other US consumer technology giants may have missed their
chance to gain a loyal consumer following in many emerging markets
because they were unable to tweak their products to meet local
preferences, as South Korean technology company
(OTCMKTS:SSNLF) and some lesser-known local brands did.
That's the clear message from new numbers on global computer device
shipments from technology market research firm International Data
In short, it seems that newly affluent consumers in emerging
nations are leapfrogging the PC era altogether. Many are still
carrying low-end feature phones, but they're trading them in, in
record numbers, for smartphones. They are particularly enthusiastic
about "phablets." And they are much more cost-conscious than
Western consumers are.
These smartphones with the awkward nickname have screens that are
five to seven inches wide. To American shoppers, they may look
clumsy or even comical when viewed as a phone. But in China and
India, they look like true multi-purpose devices.
Phablets as a category have already overtaken tablets and PCs in
emerging markets, according to
the report from IDC
on global shipments of consumer devices in the second quarter of
IDC has downgraded its estimate for global shipments of personal
computers for the second time this year because sales of PCs in
Asian markets have unexpectedly slowed as much as they have in
Western markets. (That category includes laptops and "convertibles"
as well as desktop PCs.)
Earlier forecasts had assumed that emerging markets would make up
some of the losses from US and European sales. The enthusiasm for
phablets, and for other mobile devices, is partly responsible for
the global slowdown. The report also cites the slowing of China's
economic growth and anxiety over the impact of future Federal
Reserve monetary policy changes for the lowered forecast.
IDC now estimates that global personal computer shipments will fall
by 9.7% year over year.
The report is not a total disaster for the PC industry. Over time,
it sees sales flattening rather than falling off a cliff, with
demand for new and hybrid categories of PC like ultra-slim and
convertible PC/tablets making up for some of the decline in PC
sales. For 2017, it estimates overall PC shipments of 319.8 million
worldwide, compared with 349.2 million in 2012.
But the hot category right now, particularly in emerging markets,
is the phablet. Device makers shipped 25.2 million phablets in the
second quarter, a year-over-year increase of 620%. By comparison,
shipments totaled 12.6 million tablets and 12.7 million portable
PCs, according to IDC.
Samsung, the first major company to break through with a supersized
phone, is the clear favorite among smartphone brands in both India
and China. In both countries, homegrown brands are giving Samsung a
run for its money, while US and other Western names trail in the
In India, the smartphone market overall is growing fast, with the
total number shipped up by more than 200% year over year to 9.3
million. Nearly one-third of those devices fall into the phablet
The Times of India
Although Samsung is the top smartphone vendor, with a 26% market
share, second and third places are taken by local companies, with a
combined 35% share.
) are the top-selling Western brands, but register only 5% each of
sales in the second quarter, according to
That local edge is even more pronounced in China.
As in India, Samsung is the top-selling brand, but the rest of the
top six are Chinese brands,
The South China Morning Post
Apple pops up in seventh place in China with 4.8%, having only
recently been overtaken by Xiaomi.
As the British newspaper
timing is everything
in the tech business.
) unveiled the Dell Streak with its five-inch screen too early, in
July 2009. But Apple may have waited too long. If it introduces a
phablet, and it has not said it will, it's unlikely to appear until
2014 at least.
The success of Xiaomi, only three years after the company was
formed, illustrates another attribute of emerging market consumers:
Compared with Western consumers, they're extremely price-conscious.
Xiaomi's latest model, whose name translates as Red Rice, is priced
at just $130 without a contract, but has features ordinarily found
in higher-end phones.
It now appears that Xiaomi is taking its brand on the road to other
emerging markets, including Russia and Indonesia.
If the company name sounds familiar, it's probably because it just
hired executive Hugo Barra, formerly of
surmises that the hire is part of an ambitious plan for
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