Gulf Cooperation Council (GCC) says mobile phone penetration growth rates by its member nations have slowed in recent years.

Mobile phone shipments in the GCC fell by 9.4 per cent year-on-year to reach 23.6 million units, according to research firm International Data Corporation (IDC).

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The number of mobile units shipped in 2018 is understood to be 30 per cent lower compared to the market’s peak in 2015 when the GCC saw shipment levels reach 33.9 million.

Factors including economic uncertainty, a lack of major innovation in new devices, continuous price increases and lengthening refresh cycles contributed to last year’s decline, according to Kafil Merchant, a research analyst at IDC.

GCC mobile phone sector

“Since smartphone penetration is already very high in the region … many are concluding that there is simply no good reason to purchase the latest new smartphone on the market,” Mr Merchant said.

Saudi Arabia retained its position as the GCC region’s largest mobile market, accounting for 54 per cent of the total units shipped in 2018.

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However, annual shipments to the kingdom declined by 8.2 per cent.

IDC noted that the most significant change in the Saudi smartphone landscape in the fourth quarter of 2018 was the growth of Chinese brands Huawei and Honor, and the decline in the top two brands historically – South Korea’s Samsung and the US’ Apple.

However, Samsung and Apple still retained the top two overall spots, accounting for 32.3 per cent and 23.7 per cent market shares, respectively.

IDC pointed out that Samsung’s share was down four percentage point’s year-on-year, while Huawei’s share increased by eight points over the same period.

The firm added it does not expect to see any major recovery in 2019.

“The arrival of 5G and foldable devices this year may bring some movement to the market … However, I do not expect them to bring double-digit growth to the struggling smartphone market,” an IDC analyst said.

The United Arab Emirates has the highest mobile phone penetration rate in the region, with 228.3 mobile phones for every 100 people in 2017, according to data from the country’s Telecommunications Regulatory Authority. Mobile phone penetration in Saudi Arabia is lower, at 138 per cent, as of 2017.

The GCC member nations are Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

MEED
This article is sourced from Verdict.co.uk sister publication www.meed.com, a leading source of high-value business intelligence and economic analysis about the Middle East and North Africa. To access more MEED content register for the 30-day Free Guest User Programme. https://www.meed.com/registration/