Smartphone sales to skyrocket amid dramatic price drops

Worldwide smartphone shipments are expected to exceed a billion units in 2013, up 39.3 per cent over last year, research firm IDC predicted this week.

While a number of markets are reaching saturation, demand for low-cost smartphones in emerging markets continues to drive the market forward, IDC said. By 2017, smartphone shipments are expected to approach 1.7 billion units, growing 18.4 per cent annually from 2013 to 2017.

According to IDC, the biggest driver for smartphone market growth has been a decline in average selling prices (ASP), particularly among low-cost Android devices. The firm expects ASPs to be $337 (£208) in 2013, down from $387 (£239) last year, and $265 (£163) by 2017.

"The key driver behind smartphone volumes in the years ahead is the expected decrease in prices," said Ramon Llamas, research manager with IDC's Mobile Phone team, in a statement.

"Particularly within emerging markets, where price sensitivity and elasticity are so important, prices will come down for smartphones to move beyond the urban elite and into the hands of mass market users. Every vendor is closely eyeing how far down they can price their devices while still realizing a profit and offering a robust smartphone experience."

Emerging markets such as Asia/Pacific, Latin America, and the Middle East and Africa are poised to see the greatest smartphone growth rates through 2017, IDC said.

At the same time, ASPs in these emerging markets will continue to decline, enabling many more users to afford smartphones for the first time.