Despite several industries starting to bounce back this year, the smartphone industry found itself losing ground this third quarter of 2021. Shipments shrank 6% from July-August of this year and the culprit is not the pandemic this time, although it may still be connected to it. Apparently, the chipset shortage is truly upon us. And aside from the fact that OEMs cannot meet the demand for new devices, we will also get much more expensive smartphones if the situation doesn’t improve soon.
Consultancy firm Canalys released the figures for smartphones this third quarter of 2021 and the numbers seem grim. “The chipset famine has truly arrived,” said Ben Stanton, a Principal Analyst at the firm. He explained that chipset manufacturers are raising their prices so that OEMs will not over-order. Smartphone brands are also forced to increase retail pricing due to more expensive parts as well as increased costs in global shipping.
Global smartphone shipment declined 6% from July – September 2021 year-on-year even though earlier this year, the numbers were pretty good compared to last year. But analysts were already warning back then that the chip shortage would have a major effect later on and now the industry is feeling it. As we’re heading into holiday sales during this last quarter, inventories of smartphones are running pretty low.
This means that customers can expect less aggressive discounts during major sales like Singles’ Day in China and Black Friday in the U.S and Europe. Smartphone brands will most likely bundle their smartphones with other devices like smartwatches and IoT devices to make up for the lack of big discounts. Numbers will probably go slightly up as some brands were keeping their inventory for the holiday sales but don’t expect it to go up that much.
When it comes to OEM shipments, Samsung is still top cornering 23% of the market with Apple regaining second place at 15%. Chinese brands Xiaomi, vivo, and OPPO round out the top five global brands.