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By the end of the current year, Apple and its competitors will have shipped 6.2 percent more cell phones than in 2023, an estimated 1.24 billion units, predicts IDC Research. However, iPhone sales are only expected to increase by 0.4 percent.
With an average sales price of over $1,000 (951 euros), Apple remains by far the leader in terms of profits; the Android competition comes in at around $295, estimates IDC.
Despite the hype surrounding artificial intelligence, the smartphone market collapsed after the pandemic. According to IDC, much of the growth in 2024 can be attributed to pent-up demand and countries with lower smartphone penetration. Chinese brands in particular filled the gap thanks to their affordable devices. According to the study, Apple is expected to do better again next year.
Consumer enthusiasm for new AI refinements?
However, the consumer enthusiasm for new AI refinements that Samsung, Apple and Google had hoped for did not materialize.
“While GenAI remains a hot topic and a top priority for many vendors, it is not yet having a significant impact on demand or driving early upgrades,” said Nabila Popal, research director at IDC. “More investment is needed to raise consumer awareness and introduce a must-have feature that drives consumers into stores and creates the super cycle everyone is waiting for.”
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Apple sells fewer iPhones
To guard against possible US headwinds, brands like Xiaomi and Huawei are investing heavily in hardware and developing their own processors and AI technologies. Huawei unveiled its latest smartphone on Tuesday powered by its Chinese-made chips, while Xiaomi is preparing in-house semiconductors for devices expected to be available in 2025.
Fast-growing trade in used smartphones
Global deliveries have not yet returned to pre-pandemic levels. For the coming years, IDC expects no more than low single-digit growth. The main reasons for the stagnation are longer upgrade intervals, market saturation in industrialized countries and a rapidly growing trade in used smartphones. China will probably remain one of the most competitive sales markets.
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With a map, please!
**Given the challenges in delivering compelling AI experiences, what specific AI-powered features do you believe would resonate most with consumers and drive a significant increase in smartphone upgrades?**
## The Future of Smartphones: An Interview
**Guests:**
* **Dr. Amelia Chen:** Technology Analyst specializing in consumer electronics.
* **Mr. John Smith:** Industry expert and CEO of a mobile phone accessory company.
**Interviewer:** Welcome Dr. Chen and Mr. Smith. Thank you for joining us today to discuss the fascinating future of smartphones, as highlighted in IDC Research’s most recent report. Let’s dive right in.
**Section 1: Market Outlook – Slow Growth and AI’s Impact**
**Interviewer:** IDC predicts a modest increase in smartphone shipments next year, mainly driven by pent-up demand and emerging markets. While overall growth is positive, Apple’s iPhone sales are projected to remain relatively stagnant. Dr. Chen, what are your thoughts on these contrasting trends within the broader smartphone market?
**Dr. Chen:**
(Dr. Chen begins by unpacking the reasons behind the modest growth, focusing on global market saturation and increased sales of used smartphones. She touches upon the potential of emerging markets in fueling future growth. She then contrasts this global picture with Apple’s performance, speculating on the reasons behind their plateauing sales despite strong profitability)
**Interviewer:** Mr. Smith, from a business perspective, how are companies adapting to this slower growth environment, and how do you see the role of AI playing out in this scenario?
**Mr. Smith:**
(Mr. Smith answers by providing insights into how companies are focusing on value-added services and software experiences to differentiate themselves in a saturated market. He discusses the potential of AI-powered features to drive upgrades in the future, but emphasizes the need for clear consumer benefits and compelling use cases. )
**Section 2: The AI Conundrum - Hype vs. Reality**
**Interviewer:** The article mentions that consumer enthusiasm for AI-powered features in smartphones hasn’t materialized as expected. Dr. Chen, what are the obstacles preventing AI from becoming a key driver of smartphone upgrades?
**Dr. Chen: **
(Dr. Chen elaborates on the challenges faced by manufacturers in delivering truly compelling AI experiences. She discusses the importance of user privacy and data security concerns, the need for intuitive user interfaces, and the difficulty in effectively demonstrating the tangible benefits of AI for everyday users)
**Interviewer:** There’s been a lot of talk about Apple, Samsung, and Google investing heavily in AI. Mr. Smith, what do these companies need to do to translate these investments into tangible consumer benefits that drive significant market demand?
**Mr. Smith:** (Mr. Smith offers his perspective on how tech giants can bridge the gap between AI hype and consumer expectations. He might suggest focusing on specific user needs, developing user-friendly AI features, and showcasing real-world applications that demonstrate the value of AI in everyday life.)
**Section 3: The Rise of Chinese Brands and the Used Smartphone Market**
**Interviewer:** The article highlights the growing influence of Chinese brands like Xiaomi and Huawei. Dr. Chen, can these brands challenge Apple’s dominance in the long term?
**Dr. Chen:** (Dr. Chen analyzes the competitive landscape, considering factors like pricing strategies, technological advancements, and brand recognition. She offers her perspective on whether Chinese brands can successfully compete with Apple’s premium positioning and ecosystem.)
**Interviewer:** the article mentions the booming trade in used smartphones. Mr. Smith, how is this trend impacting the new smartphone market? What are the implications for manufacturers and retailers?
**Mr. Smith:**
(Mr. Smith discusses how the used smartphone market affects the demand for new devices, particularly in price-sensitive markets. He also explores the potential opportunities and challenges for manufacturers and retailers, including the rise of refurbished phone sales and the need for sustainable business practices.)
**Interviewer:** Thank you both, Dr. Chen and Mr. Smith, for sharing your valuable insights. We hope that these conversations stimulate further discussion about the future of the vibrant and evolving smartphone market.
