The hot smartphone market in China is cooling down, per the latest report from International Data Corporation (IDC).
IDC has reported that smartphone shipments for Q4 2013 in China fell down for the first time in the last two years, which indicates that demand for smartphones is reducing in the country.
"The world has increasingly looked to China as the powerhouse to propel the world's smartphone growth and this is the first hiccup we've seen in an otherwise stellar growth path," said Melissa Chau, Senior Research Manager with IDC Asia/Pacific's Client Devices team.
The IDC reports that 90.8 million units of smartphones were shipped to China in the quarter ended December 31, 2013, when compared to 94.8 million in Q3 2013. The smartphone shipment in China in the last quarter of 2013 represents a decline of 4.3 percent on a quarter-to-quarter basis.
IDC highlights several factors that were responsible for the smartphone decline in Q4 2013. The market research firm says that China Mobile's 4G TD-LTE network went live on December 18, 2013; however, 4G-enabled handsets did not reach the market until Q1 2014. The popularity of phablets has also increased recently and operators have cut subsidies on smartphones with smaller screens.
IDC also points out Apple's deal with China Mobile as a reason for the decline of smartphone shipments in Q4 2013. China Mobile started offering iPhones from mid-January this year; as such many smartphone buyers may have held back their smartphone purchase in anticipation of the arrival of iPhones on the country's biggest wireless communications network.
"There will certainly be future drivers to unlock further smartphone growth in China, as Apple demonstrated with its China Mobile tie-up in January, and the massive device migration to come of phones only supporting 2G and 3G networks to devices supporting 4G networks. However, we are now starting to see a market that is becoming less about capturing the low-hanging fruit of first time smartphone users and moving into the more laborious process of convincing existing users why they should upgrade to this year's model," added Chau.
Chinese smartphone makers previously focused more on the local market. However, as the Chinese smartphone market is getting crowded many Chinese smartphone makers are now focusing on other emerging markets.
The IDC report also indicates that smartphone sales may bounce back in Q1 2014, but China may see moderate smartphone shipment increase in the near future.
