Recovery in 2018 for GCC Mobile Market

September 14, 2017 4:05 pm

Mobile Market

 The GCC mobile phone market remained relatively flat in Q2 2017, according to the latest figures announced today by International Data Corporation (IDC), the global technology research and consulting firm.

The newly released Quarterly Mobile Phone Tracker shows overall shipments for the quarter totalling 6.4 million units, representing a minor decline of -1 per cent quarter on quarter (QoQ) and -1.3 per cent year on year (YoY). This contrasts starkly with the steep -20.2 per cent YoY decline seen in Q1 2017, suggesting the market is beginning to show some welcome signs of recovery.

Saudi slumping

There were contrasting fortunes in the GCC’s two biggest markets, with the UAE growing 1.6 per cent QoQ and Saudi Arabia suffering the region’s largest decline at -4.2 per cent.

“Saudi Arabia continues to face major challenges with its macroeconomic situation, while the Saudization of the kingdom’s mobile phone industry continues to negatively impact the market,” says Kafil Merchant, a research analyst at IDC Middle East, Africa, and Turkey.

“This policy has caused a shift away from independent retail, with consumers gradually moving to the organized retail channel, which is heavily engaging with vendors to provide more attractive prices and offers.”

He continued: “The independent retail channel is experiencing a major slowdown as a result of restrictive credit limits and lower marketing support from vendors. However, the declines seen recently in the overall Saudi mobile phone market are expected to reverse by the end of the year as the market gradually adjusts to these changes.”

Mobiles leading the pack

In terms of the vendor landscape, Samsung continued to lead the GCC smartphone market in Q2 2017 with 38.1 per cent unit share, posting a 0.4 per cent QoQ increase in shipments. The regional launch of the vendor’s flagship S8 and S8+ models did not live up to expectations with the average selling price (ASP) falling sharply over a short period. Apple remained in second place with 20.9 per cent share but saw its shipments decline -20.2 per cent QoQ.

iOS vs Android

It is interesting to note that iOS shipments were up 5 per cent YoY in Q2 2017, while Android shipments declined -5.5 per cent over the same period. This has seen the Android/iOS split of the GCC smartphone market shift from 80.4per cent/19.1 per cent in Q2 2016 to 79.1 per cent/20.9 per cent in Q2 2017.

2018 and beyond

The market’s long-awaited recovery is tipped for next year with IDC forecasting YoY growth of 9 per cent. The market will then stabilize further in 2019 and beyond with average annual growth of 5 per cent forecast for each year through to 2021.

 

 

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By AMEinfo Staff
AMEinfo staff members report business news and views from across the Middle East and North Africa region, and analyse global events impacting the region today.



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