Long-term-evolution (LTE) smartphone market is an emerging device segment which is grabbing attention for some time now. Growing need to access data at a faster rate has provided an optimistic picture to the smartphone segment. Affordable LTE smartphones are being commercialized very recently and are set to grab a healthy pie of the market share. However, the usability of these LTE smartphones is limited to and largely dependent on the LTE infrastructure present in the respective geographies.
North America is supported by a developed LTE infrastructure which aids in the sales of LTE smartphones more aggressively. Dominated by smartphone behemoth Apple, fourth-generation (4G) enabled smartphones have gradually found acceptance in the region owing mainly to the need for faster data accessibility. Although, brand consciousness dominates the region but Android-powered affordable LTE smartphones are also making their way to this region. Unfazed by the higher costs involved in adopting an LTE smartphone, users here are comfortable with the data accessibility that LTE provides them with. On the hindsight though, North America is also offered contract-based LTE smartphones mainly by its top telecom providers which makes the ecosystem more ambiguous than anticipated. Strong competition, feature rich luxury phones and the boon of developed economy will result in a marginal price rise over the next 5 years in the region. Revenues will be high even though the shipments will be considerably less in comparison to other regions.
Developed economy in Europe is surprisingly not inclined towards LTE smartphones. One of the reasons being a developed and flourishing 3G network infrastructure. Users are already comfortable with the speeds offered by 3G networks. Dominated by GSM subscriptions also, LTE has fallen behind in attracting good user base. However, with better infrastructure already in place, Europe will start adopting LTE on a selective basis. Lack of calling features also withhold the market from adoption. As in North America, users in Europe prefer brand over features. The average price of an LTE smartphone here will decrease with the global rate.
With newer low cost models up for grabs in the recent future, this price reduction will continue to affect shipments positively for a long time.
One of the biggest smartphone markets in the world, APAC is not alien to wide user base. Mainly dominated by India and China, the smartphone adoption is witnessing an exponential rise. However, as far as LTE smartphones are concerned, there is room for market grab in these nations. On the other hand, South Korea, home of electronic companies like Samsung, LG is recognized as the first nation to be 100% 4G enabled infrastructure in the world. Closely followed by Japan and Australia, APAC will not only witness a faster price reduction but also find shipments being increased at a faster rate. LTE infrastructure is gaining good ground in emerging regions which will encourage device manufacturers to gain advantage. Contrary to developed economies in North America, users here are feature conscious and price sensitive. Low cost LTE smartphones have already made their way into these markets thereby gaining an early mover advantage. Shipments to this region will be highest in the next 5 years mainly accompanied by the faster price reduction rate expected to be around 7%.
South America lacks the LTE infrastructure to support LTE devices but a lot of work is happening around creating an awareness and educating both users as well as telecom providers on the implementation and support. 4G adoption here will be an ambling development.
Revenues for LTE smartphones will be dominated by North America. However, shipments will be dominated by APAC owing to greater price decline than other regions.