Alarming smartphone growth for emerging markets

Ovum estimates that the number of smartphones in emerging markets will reach nearly 50% by 2017, which translates to over two billion devices.

The next wave of mobile Internet users will be from urban areas of emerging markets, the analyst and consultancy firm said.

Earlier in August Gartner finds that the global sale of smartphones has outstripped that of feature phones for the first time.

Worldwide mobile phone sales to end users totaled 435 million units in the second quarter of 2013, an increase of 3.6% from the same period last year, Gartner said.

Worldwide smartphone sales to end users reached 225 million units, up 46.5% from the second quarter of 2012.

While the installed base of smartphones accounted for just over 20% in emerging markets at the end of 2012, Ovum estimates that it will reach nearly half by 2017.

Shiv Putcha, a principal analyst at Ovum says that the lack of fixed Internet infrastructure in the region and the significant purchasing power of urban residents are pushing both end users and service providers towards mobile.

Operators and content providers should therefore step up to help the next billion progress to a smarter mobile Internet experience, the analyst says.

“The rising ownership of smart devices is not just giving some consumers access to the Internet for the first time; the wide availability of these devices will also increasingly divert traffic to the mobile web,” Putcha said.

Ovum’s research recommends that mobile network operators (MNOs) embrace the prepaid user base for mobile broadband and also highlight the importance of simplified data access pricing.

“The next billion consumers are typically highly value conscious; tariff complexity combined with potential bill shock will deter prospective mobile Internet users. These consumers will expect variety and simplicity in access packages and look for unlimited, time-based, and content-based packages,” Putcha said.

For content providers, localisation of mobile content services is essential due to the strong cultural identities and preference for local languages in emerging markets.

Ovum also recommends that content providers partner with operators for billing support to enable users to spend smaller amounts over a larger period of time, particularly considering the limitations of current payment methods.

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Alarming smartphone growth for emerging markets