Smartphones in 2021
While it might not have seemed so during much of last year, 2021 was a good year for smartphones on a global basis, and while there are certainly disagreements as to the growth rate of shipments last year (range among sources is 1.0% to 8.9% y/y) it seems everyone has agreed that for the first time since 2017 smartphone shipments grew on a y/y basis. As we are data source ‘agnostic’ and are wary of outliers, we gather as much source data as possible and average the data to come up with what we believe is a consensus for yearly smartphone shipments, as shown in Figure 1, an increase of 4.7%.
That said, there has been much comment on what drove smartphone shipment growth in 2021, with much speculation on the ‘premium’ price category. Since ‘premium’ is a subjective term and is defined differently by data sources, we do not give as much weight to subjective data as we might to objective data, however before we go further, we note that 2020 was an aberrational year due to COVID-19, and based on the trend in the two previous years (2018 – 2019) we estimate that 2020 came up 119m units short. If we consider 2021 shipments inclusive of that pent-up demand, 2021’s ‘normalized’ smartphone shipments would have been 1.238m units, or down 4.5% y/y rather than up 4.7%, and while this is an exercise rather than an actual estimate, it shows that headlines pointing to the growth of smartphones in 2021 need to be examined further, and even on face value are still down 5.4% from 2019, the year before the COVID-19 pandemic, which might change the word ‘recovery’ in tech headlines to ‘bounce back’.
There were other factors that played into unit shipment growth in 2021, primarily 5G phones, which began shipping in 2019 in small quantities but saw rapid share increases in subsequent years, particularly in China where 5G base station implementations were strongest. While 5G smartphones currently represent just under 80% of all smartphones shipped in China (less globally), they are just over 50% of new models, which led us to look more closely at a different metric than units shipped. Taking ‘models’ a bit further, a number of data sources have focused smartphone growth in 2021 on the ‘premium’ category, again a subjective term, so while we did not disaggregate smartphone shipments by price tier for 2021we looked at what we call ‘model availability’ or the number of models available to consumers in each price category over the last 4 years.
Rather than break down price tiers into subjective categories, we used $100 increments to eliminate all bias and we include data from 1Q ’22, which we annualize to show what this year might look like, although seasonality is not considered. Again, these are not shipments but the number of smartphone models available to consumers across all brands. Based on that data it can be seen that the number of smartphone models in the $100 - $200 and the $200 - $300 price tiers has continued to grow from 49.9% of total models in 2019 to 54.5% of total models last year and the top two price categories, $1,000 - $1,200 and $1,200+ saw model availability growth last year of 4.4%, as Samsung’s success with foldables give more high-end choices to consumers.
Rather than make our own subjective categories, we then took the 12 price tiers and created low, mid, and high price tier categories by taking 4 price points each from the data. Looking at this data (see Figure 4) the lowest price tier has seen the number of models available to consumers rise over the last three years, albeit marginally, the mid price tier has seen the number of available models decrease and the highest price tier has been less consistent, although it increased in 2021. This data, while it does not relate directly to shipments, it does give some hints as to brand positioning and consumer demand, and could be applied more readily to sales value data, but while headlines read that ‘premium’ smartphones were leading the recovery last year, our data shows a bit less enthusiasm for high end smartphones and a steady demand for low end smartphones. All in it is another few data points in the battle to lessen the impact of headlines on investors in the CE space and make data more reliable.
That said, there has been much comment on what drove smartphone shipment growth in 2021, with much speculation on the ‘premium’ price category. Since ‘premium’ is a subjective term and is defined differently by data sources, we do not give as much weight to subjective data as we might to objective data, however before we go further, we note that 2020 was an aberrational year due to COVID-19, and based on the trend in the two previous years (2018 – 2019) we estimate that 2020 came up 119m units short. If we consider 2021 shipments inclusive of that pent-up demand, 2021’s ‘normalized’ smartphone shipments would have been 1.238m units, or down 4.5% y/y rather than up 4.7%, and while this is an exercise rather than an actual estimate, it shows that headlines pointing to the growth of smartphones in 2021 need to be examined further, and even on face value are still down 5.4% from 2019, the year before the COVID-19 pandemic, which might change the word ‘recovery’ in tech headlines to ‘bounce back’.
There were other factors that played into unit shipment growth in 2021, primarily 5G phones, which began shipping in 2019 in small quantities but saw rapid share increases in subsequent years, particularly in China where 5G base station implementations were strongest. While 5G smartphones currently represent just under 80% of all smartphones shipped in China (less globally), they are just over 50% of new models, which led us to look more closely at a different metric than units shipped. Taking ‘models’ a bit further, a number of data sources have focused smartphone growth in 2021 on the ‘premium’ category, again a subjective term, so while we did not disaggregate smartphone shipments by price tier for 2021we looked at what we call ‘model availability’ or the number of models available to consumers in each price category over the last 4 years.
Rather than break down price tiers into subjective categories, we used $100 increments to eliminate all bias and we include data from 1Q ’22, which we annualize to show what this year might look like, although seasonality is not considered. Again, these are not shipments but the number of smartphone models available to consumers across all brands. Based on that data it can be seen that the number of smartphone models in the $100 - $200 and the $200 - $300 price tiers has continued to grow from 49.9% of total models in 2019 to 54.5% of total models last year and the top two price categories, $1,000 - $1,200 and $1,200+ saw model availability growth last year of 4.4%, as Samsung’s success with foldables give more high-end choices to consumers.
Rather than make our own subjective categories, we then took the 12 price tiers and created low, mid, and high price tier categories by taking 4 price points each from the data. Looking at this data (see Figure 4) the lowest price tier has seen the number of models available to consumers rise over the last three years, albeit marginally, the mid price tier has seen the number of available models decrease and the highest price tier has been less consistent, although it increased in 2021. This data, while it does not relate directly to shipments, it does give some hints as to brand positioning and consumer demand, and could be applied more readily to sales value data, but while headlines read that ‘premium’ smartphones were leading the recovery last year, our data shows a bit less enthusiasm for high end smartphones and a steady demand for low end smartphones. All in it is another few data points in the battle to lessen the impact of headlines on investors in the CE space and make data more reliable.
Global Smartphone Shipments & ROC - 2017 - 2021 - Source: SCMR LLC, various
- Smartphone Model Availability By Price Category - Source: SCMR LLC, GSMArena, Company Data
Smartphone Model Availability Price Share By Year - Source: SCMR LLC, GSMArena, Company Data
- Smartphone Model Availability - Broad Tier - By Year - Source: SCMR LLC, GSMArena, Company Data
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