Q3 Smartphone Market Numbers, Top 10 brands, OS Wars, Installed Base (oh, and our brief smartphone market recession is already past)

Time for the Q3 Update to the Smartphone Market Share Wars. Its Samsung, Apple and the Chinese (ok, with an LG thrown in). The OS wars are long since won, done and dusted, owned by Google's Android. Migration rate of new sales of phones to smartphones is now past four of five new phones sold. A bit of good news, the smartphone market is back to growth again. After we had two quarters of unit sales decline, we now have again growth, so the smartphone market recession was brief and now past. For the full year this does mean we'll end up roughly flat with smartphone sales full calendar year 2016 vs 2015 (possibly down a few points). But growth suggests also we may well see a nice year in 2017 of healthy growth again.

Lets do our quarterly numbers: the Third Quarter Smartphone Market Unit Sales Top 10 are as follows:


BIGGEST SMARTPHONE MANUFACTURERS BY UNIT SALES IN Q3 2016

Rank . . . Manufacturer . Units . . . Market Share . Was Q2 2016 
1 (1) . . . Samsung . . . .  73.2 M . . 19.8% . . . . . . . ( 22.6% ) 
2 (2) . . . Apple  . . . . . . . 45.5 M . . 12.3% . . . . . . . ( 12.8% ) 
3 (3) . . . Huawei  . . . . . . 33.6 M . . . 9.1% . . . . . . . (   9.5% ) 
4 (4) . . . Oppo . . . . . . . . 23.9 M . . . 6.5% . . . . . . . (   5.7% )
5 (5) . . . Vivo . . . . . . . . . 19.8 M . . . 5.3% . . . . . . . (   4.8% ) 
6 (7) . . . Xiaomi . . . . . . .14.5 M . . . 3.9% . . . . . . .  (   3.7% )
7 (8) . . . Lenovo .  . . . . . 14.0 M . . . 3.8% . . . . . . . (   3.2% )
8 (9) . . . ZTE  . . . . . . . . 13.8 M . . . 3.7% . . . . . . . (   2.7% )
9 (6) . . . LG  . . . . . . . .  . 13.5 M . . . 3.6% . . . . . . . (   4.1% ) 
10 (10) . TCL/Alcatel . . .   9.1 M . . . 2.5% . . . . . . . (  2.2% ) 
Others . . . . . . . . . . . . . 109.5 M
TOTAL . . . . . . . . . . . .  370.4 M

Source: TomiAhonen Consulting Analysis 21 Nov 2016, based on manufacturer and industry data
This table may be freely shared 


So while Samsung had its exploda-phone quarter and ended up cancelling the whole Note version in its Galaxy series (and separately now has also deadly washing machines exploding, its truly the Annus Horribilis for the boys and girls there in Gangnam) but Samsung continues on the top of our charts, as this is Apple's bottom of its annual market share fluctuation. Now we will see the typical strong Christmas sales for the iPhone and if Apple is lucky, they might catch up to a troubled Samsung for a quarter (not for a full year of course).. if they're lucky. Huawei in number three continues to be unassailed from the bottom and not a threat to the top two. Steady as she goes.

In the mid-tier we have a tight race for the fight for the sixth slot with four brands separated by a few hundred thousand total smartphones sold. We see LG dropping from 6th to ninth and the other three Chinese brands all move up one slot. Oppo and Vivo are doing well in the bottom of the Top 5 and expanding steadily abroad. TCL/Alcatel is the last brand in the Top 10 and at least the India domestic market brand rivals have had a bad time in their ultra-competitive market so I don't foresee Micromax or Karbonn or Lava jumping into the global Top 10 soon Meizu of the next tier Chinese brands is the likely next to pop into our Top 10 possibly.

In new sales we see more than four out of five total handsets sold today are smartphones. The migration rate to smartphones has slowed down somewhat so it looks like we'll hit year 2020 as the first year when at the end of the year, essentially no 'dumbphones' are sold anywhere on the planet (new production of dumbphones to be at about 1% or less of total handset market by Q4 of 2020). In terms of total market, the two quarters of handset sales decline are now past, in Q3 of 2016 the industry sold 5% more smartphones than Q3 of 2015. So we are now returning to (modest) growth. One quarter won't save our year, we'll end up with a flat or slightly down year. Last quarter's numbers are here.

As I said last quarter, we are now in a recession market (or we were). So the consumers are postponing purchases, holding onto their smartphones longer and they also buy cheaper, rather than more expensive smartphones. So we see all major premium brand smartphone makers with lower sales compared to the previous quarter like Apple, Samsung, LG. But the growing brands are discount/value brands like Vivo, Oppo and TCL/Alcatel. Expect the same effects to now linger for at least a quarter or two, as consumer sentiment in the economy will always lag the real indicators, ie consumers take a while to become convinced its safe to spend again..

In the OS wars, its pretty much all Android with iOS doing its bit at 12%. Windows is selling at a level below half a percent so we now round out Windows OS to zero. So 87% for Android, 12% for iOS, and less than 1% covers all others from Tizen to Windows to Sailfish etc.

For the installed base, we get this update:


INSTALLED BASE OF SMARTPHONES BY OPERATING SYSTEM AS OF 31 OCTOBER 2016

Rank . OS Platform . . . . Units . . . . Market share  Was Q2 2016
1 . . . . Android . . . . . . . . 2,211 M . . . 80 % . . . . . . ( 79 %)  
2 . . . . iOS  . . . . . . . . . . . . 523 M . . . 19 % . . . . . . ( 19 %) 
Others . . . . . . . . . . . . . . . . 36 M  . . . . 1 %
TOTAL Installed Base . 2,770 M smartphones (ie 2.8 Billion) in use at end of Q3, 2016

Source: TomiAhonen Consulting Analysis 23 August 2016, based on manufacturer and industry data
This table may be freely shared 


So the world has 2.8 Billion smartphones in use. Essentially half of all phones in use globally today are now smartphones. 80% of them are Android based smartphones, 19% are iPhones. All other OS platforms now round off to 1% of the installed base. Even the last Windows brand loyalists are abandoning the brand of OS for their smartphones such as Lenovo announcing it won't bother with Win 10 smartphones (while they make Win 10 PCs).

A related note, the number of users of the internet from mobile phones has been greater than the users accessing from personal computers (including tablet PCs) for many years. We know that (although some analysts still seem surprised by it). Now the first data is reported that internet USAGE has shifted from PC to mobile. Statcounter has reported this moment (but they count tablets as 'mobile' so their number is not quite the moment we were waiting for). However as there are about 1.7 Billion PCs connected to the internet (including tablets) and over 3.0 Billion mobile phones (smart and dumb phones, including phablets but excluding tablets) and 45% of internet users access the internet at various times both from a mobile phone and a PC but 47% of the people on the planet who use the internet, have no PC and only access by a mobile phone... of COURSE the traffic is also going to migrate to mobile. Its inevitable. Facebook for example celebrated its moment just in October when more than half of FB traffic now comes from mobile (and duh, by far most of their revenues come from mobile).

Yeah, its 'Mobile mobile mobile' as I keep singing at my seminars and keynotes. And for all who need all the numbers (such as the number of internet access devices and users haha) - the best source of mobile industry stats is.. the TomiAhonen Almanac 2016. Get it here.

Comments

[Karl Heinz]

Could you please give an exact number of Windows Phone/Windows 10 Mobile smartphones according installed base by OS data?

[Tomi T Ahonen]

Hi Karl

It's far under 1% and vanishing so the numbers get pretty useless at that scale. In very rough terms it's under 20 million. If you need 'a number' to plug into a table or spreadsheet, you could use say 19 million but note, it is now falling so fast (oldest phones being replaced by very few new ones) that by now, mid November, the number is probably around 16 or 17 million and will be below 15 million by the end of December. When you're under 1% of a dying platform, the exact number is really meaningless..

Tomi Ahonen :-)

[Peter F. Mayer]

If you sum up the BBK Electronic brands (Oppo, Vivo and OnePlus) you would get an differentTop 10 listing, like 1. Samsung 2. BBK Electronics 3. Apple 4. ...

[Abdul Muis]

@Peter,

The BBK electronic (https://en.wikipedia.org/wiki/BBK_Electronics) have a new brand - IMOO. The target of IMOO brand of BBK group is student (https://www.youtube.com/watch?v=mGQu2XB_b7k)

So, BBK Electronic is Oppo + Vivo + OnePlus + IMOO

[Abdul Muis]

http://www.cnbc.com/2016/11/21/galaxy-note-7-recall-did-not-damage-samsung-brand-in-us-poll.html
"Galaxy Note 7 recall did not damage Samsung brand in US: Poll

A global recall of fire-prone Galaxy Note 7 smartphones did not appear to hurt U.S. consumers' willingness to buy Samsung Electronics phones, a Reuters/Ipsos opinion poll released on Sunday showed.

The survey conducted Oct. 26 to Nov. 9 found that current Samsung smartphone users were as loyal to their brand as Apple Inc iPhone customers. It also found that people who knew about the recall were as interested in Samsung phones as those who did not.

......

The poll found that Samsung's customers were fiercely loyal to their brand. Some 91 percent of current Samsung users would likely purchase another Samsung smartphone, and 92 percent of current users would probably buy another Samsung product in general.

........
"

[Abdul Muis]

If the above poll were correct, samsung will have a surge in next Q3 2017

[Karl Heinz]

Thank you very much, Tomi!

[Abdul Muis]

http://news.softpedia.com/news/htc-might-sell-its-smartphone-business-in-2017-510374.shtml

"HTC Might Sell Its Smartphone Business in 2017

A new rumor now claims the company has already decided to sell its smartphone business, which was bleeding money for a few years now. Ms Cher Wang, HTC general manager, is said to have already sent a message to her closest collaborators that the smartphones business will be sold in the spring, next year.

Even though the Taiwanese media reports that HTC has denied these rumors, analysts claim that this is exactly what companies usually do before signing up the sale agreement.

The same source state that there actually four companies interested in buying HTC's smartphone business and one of the them is from Taiwan, the handset maker's home turf.

.....
"

[RickO]

Tomi - is this the first signs of a new but bigger version of - Smartphone Bloodbath - happening in the next year or two. MicroSlop dead and nearly buried, CoolPad came and went, Sony is slowly disappearing, so who else outside of the top 10 could crash and burn. Unless a company needs production facilities for extra volume urgently, it would be a very risky business shelling out all those dollars to buy a dying brand name. Nokia brand will re-appear early next year as well to add to the congested Android market.

[Abdul Muis]

I really wonder what went wrong with Sony. Their device quality have a great quality. Their flagship is really great.

I own Xperia Z & Nexus 4, while both device have almost the same specs (snapdragon S4 /2GB RAM), I feel that my Xperia Z is more smooth, faster and have better battery life.

[RickO]

Just read - Gartner has (sales to end users) Oppo 6.7% Vivo 5.3% Iphone 11.5%. Interesting.
Also just read - LeEco is apparently having financial problems. So who else is.
As I said months ago - Iphone sales will pick up leading into and through Xmas - BUT - I still predict that 2017 could be iPhones year to hell but possibly back with the iPhone 8 later in the year.

[E.Casais]

@Peter F. Meyer

"If you sum up the BBK Electronic brands (Oppo, Vivo and OnePlus) you would get an differentTop 10 listing"

I concur.

Aggregating the vast array of brands corresponding to the Chinese manufacturer Tinno, and the top-10 ranking will have an even more intriguing outlook.

It is a bit like Volkswagen, General Motors or Fiat: to gauge their actual market power, one must consider the whole conglomerate, not just individual brands.

@Abdul Muis

"I really wonder what went wrong with Sony."

Inconsistent product line-up, with devices often more expensive than the competition for the same feature set.

Locally Sony might still go strong, though.

In Switzerland for instance, Sony is still very much present in the offerings of electronic shops and mobile phone retailers.

[Per "wertigon" Ekström]

My linear "toy" model based on past performance seems to have caught up as well, it suggested 376M based on past performance so not that far off. Of course this model does not take into account things like Samsungs exploding batteries or other stuff like that so don't base anything off it, it's just a hobby excel sheet I run for fun, based on past and current growth rates. :) It suggests a total market of around 1500M units (and 74M iPhones), Tomi, is that plausible numbers?

In related news, Apple moving average marketshare is down to 14.6% if anyone cares, now we shall see what the iPhone 7 will respond to that.

[cornelius]

@Wayne Brady

Given that Tim Cook has included laptops, watches, Apple TV devices, iPads, iPods, iDongles and other magical iStuff in the billion he mentioned, probably 562m is about right from the point of view of number of devices (but it is too high from the point of view of the value that you get for the money you spend on these devices)

[cornelius]

News from the land of the dead. Basically Microsoft is giving up on Universal Windows Platform (UWP) and instead is building an emulator for traditional desktop apps to run on ARM devices. This will fail too. Besides the fact that the mobile apps UI is very different than desktop apps UI, the problem is that ARM processors are weak compared to x86 processors that power today's desktops. On top of that, the only useful situation is if this emulator is used in conjunction with Continuum. But the problem is that Continuum is already very heavy on resources. So now the poor ARM CPU must run Continuum, then must run the heavy desktop apps on top of an emulator that makes then even heavier. Why would any sane person buy a flagship Windows phone + the keyboard and the screen and whatnot (easily over $1000 in total) just to have basically what is an underpowered laptop? Why not buy a phone and a powerful laptop with the same amount of money?

Microsoft's x86 on ARM64 emulation: A Windows 10 'Redstone 3' Fall 2017 feature

http://www.zdnet.com/article/microsofts-x86-on-arm64-emulation-a-windows-10-redstone-3-fall-2017-deliverable/

[grouch]

Where (geo-politically) is the market growing the most? Will Captain Krazy really try to coerce Apple into manufacturing in the U.S.?

[Tomi T Ahonen]

Hi Wayne and Cornelius

Cornelius, thanks for responding already.

Wayne, this question comes up in many of the Quarterly update blogs. Same issue every time. Comparing my count of iPhone installed base number to Tim Cook's public statement about all Apple devices live. And we have the same argument every time in the comments. I am sick and tired of repeating myself. If it is YOU who asked this point before - then I am offended, that you refuse to accept my previous answer without responding to THAT, and rather feign ignorance and ask a stupid question now. Secondly, you Wayne have been on this blog for ages and have regardless read my ANSWER to that question, whoever posed it before, and KNOW why my number is lower. Third, Cornelius already told you.

But from me. If it was not you before, then you must have missed the recurring theme of the commentary of Apple's iPhone installed base analysis for years. I find that hard to believe. In that case, please accept Cornelius's answer, he like the other regulars has read my answer many times enough to have memorized MY RESPONSE to the question.

If it WAS you before then you are now being abusive to me personally. Stop it. The one thing I do not have much of, especially now in the busy season of the year for consulting, is extra time to waste. I don't like to repeat myself. You know the answer. Whether you like it or not, do not act abusively towards me and pretend you didn't hear the first time. Don't repeat this question EVER AGAIN Wayne or I will revoke your privileges on this blog. This question has been asked and answered so many times that our other readers know the answer by heart.

Thanks, Cornelius for the quick response to it.

Tomi Ahonen :-)

[Tomi T Ahonen]

hi grouch

Just quick heads-up on the market biggest growth. Its in least affluent parts of the planet but their large countries. India, Nigeria, Vietnam, Egypt, Pakistan, Bangladesh, etc. Countries where mobile penetration rate nationally is still under 100% and smartphone migration rate is well under 33%. But within those regions, it is their largest countries because that is where the handset makers can afford to focus on now (India rather than Nepal; Nigeria rather than Cameroon; Vietnam rather than Laos, etc). So where we recently saw a lot of buzz, countries like China, Indonesia, Brazil, Mexico, Russia, Turkey etc these are far too advanced already for any big opportunities to remain, so their growth rates are modest at best.

Tomi Ahonen :-)

[Tomi T Ahonen]

Hi Per

Very plausible numbers yes. I think your full year number is a bit too high (I expect year to end around 1,450 rather than 1,500 because of the two quarters of downturn. Of course I hope I am wrong and you are right and the year ends stronger than I had expected...).

The iPhone number somewhere in the vicinity of 75 million plus or minus a few million is very reasonable.

Tomi Ahonen :-)

[Tomi T Ahonen]

Hi Peter, Abdul and E

Yeah we could also count the full consortium numbers, its certainly another fair way to do it. I could do that for the next blog which has the year-ending numbers. We do already include various owned brands with their parents in other cases like Motorola with Lenovo, Alcatel and others with TCL etc.

Tomi Ahonen :-)