According to Taiwan's MIC (Market Intelligence & Consulting Institute), an ICT industry research institute based in Taipei, considering the global telecom market development where Western European telecom operators did not see strong revenues in general, the global mobile phone market saw a year-on-year decline of between 3% and 9% in the first half of 2012 and a decrease in ARPU (Average Revenue Per User). The importance of emerging markets will become increasingly evident and global mobile phone telecom operators around the world will face challenges to sustain their operating profits.
According to MIC's senior analyst Edward Lin, Samsung which led the market leadership in the first quarter of 2012 continued to see its market share grow to 23% in the second quarter of 2012. Of the total mobile phone shipped by Samsung, 50.50 million units were Smartphones. Samsung is among one of few branded vendors that were able to enjoy shipment growth in the second quarter compared to the first quarter. In order to prevent a loss in market share following the launch of Apple's iPhone 5, Samsung launched the Galaxy Note II featuring a 5.5-inch AMOLED (Active Matrix Organic Light Emitting Diode) panel on August 29, 2012.
With the penetration rate of Smartphones in mature markets reaching over 60%, the importance of emerging markets will be significantly highlighted. In emerging markets, Samsung has to compete with other rivals for a low ARPU (Average Revenue Per User) user base with low-priced products and sustaining profitability with an profit margin around 17%-18% will be a huge challenge for Samsung.
In the second quarter of 2012, the iPhone shipment volume did not live up to market expectations, mainly due to users' deferred purchase in anticipation of the unveiling of iPhone 5. On September 13, Apple officially launched the iPhone 5 with features including a 4-inch Retina display screen using in-cell touchscreen technology and HD front-facing camera as rumored. However, as the iPhone 5 was launched in mid-September, the positive effect of iPhone 5 launch on the total iPhone shipment is expected to be limited in the third quarter of 2012 during which the total iPhone shipment is expected to still witness a sequential decline.
MIC stated that Taiwanese Smartphone branded vendor HTC witnessed revenue declines in the first half of 2012, partly due to the shortage of 28nm chips and the two-week deferred shipment to the United States resulting from patent infringement issues. But, on top of the pile of reasons behind the HTC downturn is that the company starts losing its edge, such that, without production scale like Apple and Samsung, the company is likely to have trouble lowering production costs and ensuring a stable supply of key components.
More information can be found in the following MIC report: Worldwide Mobile Phone Vendor Performance, 3Q 2012
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Market Intelligence & Consulting Institute (MIC), based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english