Smartphones may soon be 'face to face' with an issue affecting them as a class of devices that could affect the position of some companies in the market, as well as the industry as a whole.
The problem is not new, at least for technically sophisticated devices that came before smartphones. After a long period of successful growth, the smartphone market is approaching its high point. In the US, a scenario of no high demand is likely due to sluggish interest in the class of devices this year or next. The fast-growing Chinese market has already experienced an annual decline in shipments in the first quarter of the year. Globally, the smartphone market is still expected to grow in 2016, but forecasts have been cut to single digits.
Many recent news stories on the topic point to market saturation, especially in the US, Western Europe and China, regions where smartphones have become a part of everyday life. But the problem goes deeper: people have started using smartphones longer, extending the life cycle of devices. A recent study conducted by Technalysis Research in five countries (USA, UK, Germany, Brazil, China) among 3,000 consumers found that the average expected life of devices is 1.8 years. On the surface, this time does not look like something strange and coincides with the previously existing paradigm of using devices. In response to the same question, but about laptops and PCs, users considered a 2.5 year life cycle appropriate.
As we have already seen on the example of PCs, and then tablets, as the market reaches saturation point, future growth becomes completely dependent on the frequency of updates and the life cycle of devices, on how often (rarely) you decide to update your existing device / devices. . In the case of smartphones, longer use of the device is made up of several key factors. In the United States, a large role was played by the gradual disappearance of subsidies by operators to purchase a phone, however, in other countries such a system did not exist, users always paid the full price. In such regions, and now in the US, the main problem has been the lack of meaningful innovation as smartphones reach 'maturity' and the quality and functional level that meets the needs of most users.
To be clear, I am not saying that smartphone innovation has disappeared, it is not, but as soon as people get an HD display with a diagonal of five inches or more, a high-quality camera, a large amount of memory, quick access to the network and
millions of apps and services, most people think the phone is 'pretty good'. The key factor in reaching this 'point' was the relatively large displays and Apple, albeit belatedly, benefited from the launch of the previous generation of their smartphones with large screens.
Over time, it will become much more difficult to create innovations that can make people feel the real need to update devices. In fact, I partially attribute this fact to the reason why operators and companies such as Apple create and actively promote programs that contribute to the regular updating of devices of the previous generation. Many of these companies are concerned that otherwise users will not buy new devices often, or at least at a frequency that is beneficial to such companies. Interestingly, the first reports on such update programs reflected the strong interest of users, but, importantly, few actually exchanged their current devices for new products. Obviously, many people perceive such programs as a safety net that they can use whenever / if they want.
Hardware isn't the only problem. As people perform more and more tasks with their smartphones, the amount of information on devices has grown significantly. This, in turn, makes the process of switching from an old device to a new one more difficult. Instead of just transferring your contact list to the new device, now you have to transfer photos, music, videos, applications, settings and much more. Even if you use a lot of cloud-based applications, you still need to log in again, often trying to remember long-forgotten passwords. Add to this the possibility of switching to a new version of the OS, which may not 'like' the version of one or another application, and will have to update the applications themselves, which by itself implies not a seamless transition. It's not as bad as, for example, upgrading a PC, but the recent experience of upgrading a smartphone gives the impression that the upgrade processes are becoming more and more identical.
Despite these problems, the smartphone market is strong at this stage, with shipments of about one and a half billion devices per year. But, apparently, a new era for the industry is not far off, and longer lifecycles of smartphones will become fundamental for device manufacturers, component suppliers, application developers. It will be very interesting to see how companies adapt to the new reality.
Original material by Bob O'Donnell
Elir: another and, in my opinion, quite adequate attempt to draw a parallel between the development of smartphones and PCs. In fact, have smartphones reached a technological peak? And aren't we, as users, fed up with a dense stream of innovations? The other day, I uncomfortably took the smartphone out of my pocket and therefore did not run it at the right angle on the fingerprint sensor (SGN4), unlocking it only the second time. Accidentally caught the eye of the owner iPhone 6, in which one could catch a share of smugness and sarcasm. At this, I already smiled to myself, realizing that two or three years ago we did not even dream of a fingerprint scanner in smartphones and tablets, let alone such smirks in the style of 'ha, a whole second and a half to unlock, a nightmare'. Today, on the one hand, the user is spoiled, on the other, he is more pragmatic in terms of selecting new devices to replace old ones. Again, by my own example – of all last year's devices, the greatest 'wow-effect' was caused by Motorola X Force, but its cost in our market will not have a positive effect on my decision to buy. Yes, and in the current device, it suits absolutely everything, no critical shortcomings.
I agree with the conclusion that the restructuring of company strategies will be an interesting sight. Nevertheless, transferring the discourse to Russian reality, one can notice that the updating process is often perceived by more or less wealthy users not as something necessary from a technical point of view, but as a kind of status purchase / gift, which is very beneficial for producers who are left with only to convince us of the exceptional premium quality of the new device in comparison with the last year's model. What is the life cycle of your devices? Do you like the possible increase in the time between updates of the gadget fleet?