Domestic mobile phone still accounts for 90% market share, and market is approaching "ceiling".


Domestic mobile phone still accounts for 90% market share, and market is approaching

In May, the domestic mobile phone market shipments rebounded slightly, ending 14 consecutive months of single month shipments year-on-year decline. But experts say, after more than 10 years of rapid development, China's mobile phone market is close to saturation; with lack of innovation and new highlights of products, the willingness of users to change planes is low, and the decline cycle of the mobile phone market will continue until the end of the year. It is expected that with the commercial start of 5G in 2019, China's mobile phone market will enter a new round of prosperity cycle.

Data released by the China Institute of information and communications showed 37 million 836 thousand shipments in May, up 1.2% from a year earlier, ending a year-on-year decline in single month shipments for 14 months. Does this mean that the domestic mobile phone industry has bottomed out? Liu Ruofei, an analyst at sadi Consultancy Industry Research Center, said in an interview with the Economic Daily reporter that this does not mean that the mobile phone industry has been warming up, but a small rebound in the early decline, and the decline of the mobile phone market will continue until the end of the year.

China is expected to start the 5G business process in 2019. "At that time, the replacement of network technology is expected to bring a new round of change. It can be expected that China's mobile phone market will enter a new round of business cycle in 2019. Liu Ruofei said.

The market is approaching the ceiling

Although the data rebounded slightly in May, overall, from January to May, the domestic mobile phone market volume was 159 million, down 19% from the same period last year. From the recent data, we can see that 2017 is a turning point in China's smart phone market, and sales of smart phones have begun to shrink. Domestic mobile phone shipments reached 459 million units in 2017, down 4% from the same period last year. This downward trend has lasted for nearly a year and a half.

"After more than 10 years of rapid development, China's mobile phone market is almost saturated, and the incremental space is almost small. In the stock market, users will have less willingness to transfer. Liu Ruofei said.

Liu Ruofei's analysis of the reasons for the low willingness of users to transfer is that the first is the dividend of consumer groups. 3G, 4G switch as a symbol node, operator driven and Internet brand dividends gradually disappear, the three or four line and below the market is OPPO, vivo and other domestic brands in depth, the stock change space in the Chinese market is constantly squeezed. Two is the lengthening of the time for the user to change. At present, the performance and quality of smart phones are becoming more and more excellent, but the homogenization is serious. The three is the price factor restraining consumption. The price of high-end smart phones has increased year by year, inhibiting the purchase intention of some consumers.

In addition, the reduction in the number of new mobile phones is not conducive to stimulating users to switch. Data show that in May, a total of 62 new models were listed in the domestic market, down 50.8% from the same period last year, and 323 new models listed between January and May, down 31.3% from the same period last year. The main reason for the decrease of new models is the decline in sales and the lower and lower overall profit level, which has led to a decline in innovation power of mobile phone manufacturers.

"Smart phones are now in full maturity, and it is hard to see any new innovations." Liu Ruofei said, whether high-end mobile phones or low-end phones, many years have not been able to resist the desire to buy "black technology" has emerged.

As a result, 5G is given high expectations. As 5G is about to be commercially available, mobile phone manufacturers will usher in a new wave in the innovation of 5G phones.

Domestic mobile phones occupy the mainstream

Affected by the overall market downturn, the market capacity of the three or four tier cities and rural areas is gradually saturated. From January to May, domestic brand mobile phone shipments were 142 million, down 20.4% year-on-year.

Nevertheless, in the domestic market, domestic brand mobile phones are still the absolute market players, occupying 90% market share. The data show that in May, domestic brand mobile phone shipments were 34 million 48 thousand, accounting for 90% of domestic mobile phone shipments in the same period. From January to May, domestic mobile phone shipments accounted for 88.7% of domestic mobile phone shipments in the same period. "The distance between domestic mobile phones represented by HUAWEI and foreign brands is getting smaller and smaller. Especially in the past two years, Samsung and apple have been weak in innovation, bringing huge market space to domestic mobile phones. Liu Ruofei said.

"Compared with Samsung and apple mobile phones, domestic mobile phones have certain advantages." Liu Ruofei said, one is a high price ratio, the same price of mobile phone, domestic brand of memory, pixel, video card and other basic performance of higher configuration; two is based on the local conditions of the design optimization, such as a more changeable shape and bright color matching, the operation is more in line with the Chinese habit; three is a larger marketing investment, and The ways and means of marketing are all rich and flexible.

At the same time, China's mobile phone industry chain supporting capability is also rising. The development of chip design enterprises has promoted the significant improvement of the homemade rate of the main components of mobile phones. In 2017, domestic chip mobile phone shipments accounted for nearly 20% of the domestic market, and more than 85% of the mobile phone LCD screens came from domestic brand panel enterprises. Domestic enterprises have established several OLED production lines, and BOE and huopo already have OLED products shipped. With the production of domestic OLED panels in the future, the domestic mobile phone industry will rely on foreign brands in the high-end display area.

Innovation can continue to attack

Domestic mobile phone has become an absolute market player from a market share of less than 5%. An important reason is that enterprises pay attention to innovation. From January to May, domestic mobile phones listed 297 new models, accounting for 92% of the total number of new mobile phones listed in the same period in the same period.

Recently, domestic mobile phone new products are listed on the market. In June 5th, Lenovo released 3 mobile phones at one breath. Among them, Z5 mobile phone super high cost performance allegedly will end the full screen mobile phone profiteering. Liu Jun, the executive vice president of Lenovo Group and President of China District, said that Lenovo cell phone once created the first three Chinese brands in the domestic market and the top three in the world. After joining the mobile phone business, the mobile phone will take the support of the PC customer group and the sales service network.

In the late June 12th, vivo high-end mobile phone NEX listed, in addition to the full screen, screen fingerprint identification, lifting camera, full screen voice and other technologies, artificial intelligence is a big spot. The Jovi, an artificial intelligence assistant built in the phone, has fully upgraded its functions. Encyclopedia, shopping, translation, scanning and screen reading are all intelligent functions. 20 high frequency scenes and 600 core functions, so long as you move your mouth, you can complete the instructions. According to the introduction, vivo has established a joint laboratory with NetEase, Gao De, Baidu, signal flying, ant gold clothing and other partners. It works well in artificial intelligence algorithms and data, and builds a technical ecosystem of speech recognition, machine vision, semantic understanding, knowledge map and so on.

"Domestic mobile phone technology continues to emerge." Liu Ruofei said that, in the speed of hardware application, comprehensive screen, fast charging, rotating camera, five times nondestructive zoom, four axis optical anti shake, invisible fingerprint identification, virtual reality and other technologies have been applied to domestic brand mobile phones. In terms of AI applications, domestic brand mobile phones have also explored a lot. For example, HUAWEI's Kirin 970 chip, which carries artificial intelligence algorithms, is the world's first artificial intelligence chip, and vivo phones have joined the technology of artificial intelligence and beauty.

The number of mobile phone shipments will fall further this year. The number of mobile phone shipments in China is expected to be around 450 million, and the "five strong" brands headed by HUAWEI, millet, OPPO, vivo and Meizu are expected to occupy more than 90% of the market share of domestic mobile phones.

(edited: Zhu Chuange, Dong Jing)


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