Peak smartphone? Phone fatigue hits Western Europe hard

♫ We're so bored with your USP ♫

Smartmobe shipments were down almost 7 per cent year-on-year in Europe during calendar Q1, according to Canalys, as phone fatigue hit mature markets hard.

Some 46 million units in total were shipped in the three months, this included a 13 per cent drop in Western Europe to 30.1 million phones and a 12.9 per cent rise in Central and Eastern Europe to 15.9 million.

Punters in the West continued to cling onto their devices for longer and chose more SIM-only deals, plus more shoppers opted for refurbished models.

Canalys said the two biggest losers year-on-year were Samsung and Apple. Sammy's shipments fell 15.4 per cent across Europe to 15.2 million units, and Apple's sales fell 5.1 per cent to 10.2 million units, despite having a broader range than ever that includes the iPhone SE.

The big winners? Huawei, with shipments 38.6 per cent up to 7.4 million, thanks to its Honor line, and … <drumroll, stamping of elks hooves> Nokia. Nokia moved 1.6 million phones in Q1, reckons Canalys, placing it in the top five. This confirmed positive estimates from Counterpoint in January, which pegged Nokia at number three in the UK in Q4.

Recent Apple earnings indicate that higher prices have compensated for fewer iPhone Xs sold. Samsung too is seeing the financial benefits of higher prices – Canalys estimated the value of its shipments has risen 20 per cent.

UK sales fell 29.6 per cent on the prior year period, France was down 23.2 per cent and Germany by 16.7 per cent. In the UK SIM-only (SIMO) deals are now more popular than contracts that bundle a handset with “airtime”, as it’s still called, quaintly.

But if the problem is a slower purchase cycle, then the top-tier vendors risk making things worse by making their flagships ever more expensive. It simply prompts many to defer a purchase. Call it a “runaway contagion”, if you like.

Ben Stanton, Canalys researcher, told us the UK market reached a "saturation" point and a lack of innovation from phone makers meant consumers weren't tempted to buy the latest generation models. ®

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