Annual worldwide smartphone shipments to hit 1.8B by 2018

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More than 1.25 billion smartphones will be shipped worldwide in 2014, representing a 23.8 percent increase from the 1.01 billion units shipped in 2013, according to a new mobile phone forecast from the IDC Worldwide Quarterly Mobile Phone Tracker.

Total volumes are forecast to reach 1.8 billion units in 2018, resulting in a 12.7 percent compound annual growth rate for the 2013 to 2018 forecast period, according to a press release about the report.

Emerging markets have accounted for more than 50 percent of annual smartphone shipments dating back to 2011. Until this year, mature markets have consistently delivered double-digit year-on-year growth, according to the press release.

IDC said that in 2014 it expects mature markets will slow to just 4.9 percent growth, with emerging markets continuing to soar at 32.4 percent, pushing the total market up 23.8 percent.

“The smartphone market, which has experienced runaway growth over the last several years, is starting to slow,” Ramon Llamas, research manager with the IDC mobile phone team, said in a statement. “Mature markets have slowed considerably but still deliver strong revenues with average selling prices over $400. Meanwhile, many emerging markets are still barreling along, but with ASPs of less than $250.”

IDC expects emerging market smartphone volume to grow to 920.8 million units, accounting for 73.5 percent of all volume shipped in 2014, according to the press release. Android devices are expected to account for 88.4 percent of this volume. IDC’s outlook for emerging market smartphone volume is 1.4 billion units by 2018, growing to 79.5 percent of worldwide volume.

“The support that Google’s Android platform has received from over 150 handset manufacturers has allowed it to gain the share it has in emerging markets,” Ryan Reith, program director with IDC Worldwide Quarterly Mobile Phone Tracker, said in a statement. “The lack of constraints around hardware and software specifications has helped bring to market many low-cost products, a lot of which could be considered borderline junk. With Google’s recent announcement of Android One, they hope to change this by laying out a set of standards for manufacturers to follow.”

The other widely discussed trend has been the shift towards large-screen smartphones, according to the press release. IDC expects “phablets” (smartphones with 5.5-inch to 7-inch screens) to grow from 14.0 percent of the market in 2014 to 32.2 percent of the market in 2018. With the expected entry of Apple into this market segment, and the pent-up demand for a larger screen iPhone, Apple has the ability to drive replacement cycles in mature markets despite the slower growth seen in recent quarters.