For the April-June quarter Apple Inc. (NASDAQ:AAPL)’s market share in China almost halved to 10 percent. The main reason for this fall is none other than Apple’s own much awaited iPhone model, expected later this year. Many buyers have postponed their purchase until the next model is available, or have switched brands.
China is expected to overtake United States as the world’s biggest smartphone market this year, and highlighting the same, for the first time smartphones shipments in China overtook feature phones in the second quarter. For the April-June quarter, 44 million smartphone were shipped, which was almost 51 percent of China’s total mobile shipments of 87 million.
IDC said.”There are two things in play,” said IDC analyst TZ Wong, referring to Apple’s drop in ranking and market share. “One is seasonal, people know the new phone is coming, And the second is that the alternatives are becoming much more attractive than a year ago. The iPhone didn’t change much over the year.”
According to the research from IDC, local players like Lenovo Group Ltd (SEHK:0992) and ZTE Corp (SEHK:0763) overtook Apple Inc. (NASDAQ:AAPL) in its second-largest market, leaving Apple at fourth place, while South Korea’s Samsung Electronics Co retained its top spot, with a 19 percent share, also down from 21 percent from previous quarter. Lenovo, the second largest PC maker, which makes the LePhone, jumped to second spot from an earlier seventh, with an 11 percent market share, an increase of 1 percent from earlier quarter. Local rival Huawei Technologies Co Ltd ranked fifth.
In the overall mobile phone market in China, including smartphones and feature phones, Samsung, Nokia Corporation (NYSE:NOK), and ZTE bagged the top spots in the second quarter.
Along with the smartphone makers, China is also a major market for chipmakers. US based Qualcomm, Inc. (NASDAQ:QCOM) has long been trying to capture the market dominated by Taiwan’s Mediatek Inc (TWSE:2454) and China’s Spreadtrum Communications Inc. (NASDAQ:SPRD). Due to its continuous efforts, recently launched Chinese smartphones ,Huawei’s G330D, and Xiaomi Technology’s MI2, contain Qualcomm’s Snapdragon chips.
“It’s such an important market because of the volume and the growth rate, which are so attractive for chipset vendors … so we’re seeing a lot of competition,” said James Shen, Qualcomm’s vice president for business development.
According to IDC, Chinese brands are bound to gain more market share than their western counterparts, due to aggressive marketing and close ties with local carriers, such as China Mobile, China Unicom, and China Telecom. “In the mid- to long-term, it’s very possible they will start to dominate four of the top five (rankings), leaving Samsung as the only one standing. At that point, even Samsung will start to feel the pressure.”