Smart Connected Devices in Emerging Markets to Surpass 1 Billion Unit Shipments by 2014 with More Than 60% Going to BRIC Countries, According to IDC

FRAMINGHAM, Mass.--(BUSINESS WIRE)--According to the International Data Corporation (IDC) Worldwide Quarterly Smart Connected Device Tracker, global shipments of smart connected devices (PCs, tablets, and smartphones) are expected to surpass 1.7 billion units by 2014 with roughly 1 billion units delivered to emerging markets. Within the emerging markets, the BRIC countries -- China, India, Brazil, and Russia -- are expected to generate shipments of 662 million units with a shipment value of more than $206 billion. More than 650 million units are forecast to be shipped to developed markets, with the United States, UK, and Japan capturing more than 400 million units with a shipment value of $204 billion.

With the BRIC countries expected to surpass the total shipments to developed markets by 2014, it is clear that demand for smart connected devices is quickly shifting from developed to emerging markets. The emerging markets are expected to grow at a compound annual growth rate (CAGR) of 17% over the 2012-2017 forecast period, compared to the 7% CAGR expected in developed markets.

In terms of product categories, the smart connected device market will be largely driven by the growing demand for smartphones and tablets in both emerging and developed markets. Of the 1.7 billion units forecast to be shipped in 2014, more than 1.4 billion units are expected to be smartphones and tablets, representing more than $500 billion in value. PCs, on the other hand, will be a comparatively small market with just over 300 million units shipped and a shipment value of less than $200 billion.

"It is evident that smartphones and tablets have successfully established a strong presence as the 'second screen', owing to the transformation in usage patterns, device affordability, and, most of all, the comfort of a mobile and digital lifestyle," said Megha Saini, Research Analyst with IDC's Worldwide Smart Connected Device Tracker. "Vendors and OEMs need to be aware of the different usage patterns so as to drive product innovation that suits the tangible needs of their digital consumers."

With the rise in global smartphone and tablet shipments, the average selling price (ASP) of these mobile computing devices is steadily decreasing. Tablet ASPs plummeted -19% year over year in 2012 to $426, down from $525 in 2011. Smartphone ASPs fell -8.2% year over year to $407 in 2012, down from $443 in 2011. This pattern of decreasing price points is most prominent in emerging countries where IDC expects sub-$300 smartphones and sub-$350 tablets to drive huge shipments in 2014 and beyond. In developed markets, smartphones and tablets will continue to generate higher ASPs of $490 and $370, respectively, in 2014.

"Smartphone and tablet prices are now less prohibitive to first-time buyers in emerging markets," said Bob O'Donnell, Program Vice President, Clients and Displays. "Although the double-digit growth of smartphones and tablets in emerging countries is a mouthwatering prospect, the low selling price also means that vendors will face huge struggles to meet the demands profitably. Given the competitive price points for cheaper smartphones and tablets, this price war is a race to the bottom and it's not at all clear that this low-end market offers sustainable profits to smartphone and tablet vendors."

Another factor fueling the growth of smart connected devices in emerging markets is the upsurge in the use of different mobile applications, such as mobile messaging, gaming, social networking, and social commerce, including mobile check-in services. Growing interest from governments, especially in education projects across countries like India, Thailand, Turkey, and the UAE, has also boosted the prospects of low-cost tablets for students in these regions. Indeed, the proliferation of cheaper, yet more capable devices, along with the deployment of 3G/4G services and changing usage patterns have been pivotal in driving the overall growth of smart connected devices in emerging markets.

Smart Connected Device Unit Shipments by Region and Product Category, 2012-2017 (shipments in millions)
Region	Product Category	2012	2013*	2017*
Developed Markets	Desktop PC	55.3	49.5	43.2
Developed Markets	Portable PC	94.1	83.5	84.2
Developed Markets	Tablet	90.8	131.9	219.6
Developed Markets	Smartphone	296.5	338.9	465.6
Total Market		536.8	603.8	812.8
Emerging Markets	Desktop PC	92.9	84.9	80.6
Emerging Markets	Portable PC	106.8	103.8	125.2
Emerging Markets	Tablet	53.6	97.3	190.6
Emerging Markets	Smartphone	425.9	619.8	1,113.1
Total Market		679.2	906	1,509.5
Worldwide	Desktop PC	148.2	134.4	123.8
Worldwide	Portable PC	200.9	187.4	209.5
Worldwide	Tablet	144.4	229.3	410.3
Worldwide	Smartphone	722.4	958.7	1,578.7
Total Market		1,216.1	1,509.9	2,322.4
Source: IDC's Worldwide Smart Connected Device Tracker Forecast Data, May 30, 2013
* Forecast estimates.

Smart Connected Device Market by Product Category, Shipments, and Market Share, 2012-2017 (shipments in millions)
Product Category	2012 Unit Shipments	2012 Market Share	2017 Unit Shipments*	2017 Market Share*	2012—2017 CAGR
Desktop PC	148.2	12.2%	123.8	5.3%	-3.5%
Portable PC	200.9	16.5%	209.5	9.0%	0.8%
Tablet	144.4	11.9%	410.3	17.7%	23.2%
Smartphone	722.4	59.4%	1,578.7	68.0%	16.9%
Total	1,216.1	100%	2,322.4	100%	13.8%
Source: IDC's Worldwide Smart Connected Device Tracker Forecast Data, May 30, 2013
* Forecast estimates.

Taxonomy Note: Developed Markets include: USA, Canada, Western Europe, Japan, Australia, and New Zealand.

In addition to the table above, an interactive graphic showing smart connected device market share by device category for 2012, 2013, and 2017 is available here. The chart is intended for public use in online news articles and social media. Instructions on how to embed this graphic can be found by viewing this press release on IDC.com.

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