Shipments in 2014 of 4G smartphones in China is expected to reach 72.4 million units, up nearly 1,500 percent from 4.6 million last year, said IHS Technology. This will benefit Samsung, Apple, Huawei, ZTE, Lenovo, etc.
4G smartphone market in China will double next year to 144.1 million, rising another 53 percent to 219.8 million, and then ending 2017 at 298.5 million units.
China Mobile, China Telecom and China Unicom will drive market demand.
4G smartphones will account for 19 percent of the entire China smartphone market this year of 371.8 million, with 3G handsets still making up the majority and 2G models also still available.
China’s 3G smartphone market in 2014 will reach 290.3 million units, up 1 percent from 287.2 million last year. 3G shipments will continue to dominate the China smartphone market for two more years, after which 4G handsets take over permanently.
The overall Chinese smartphone market is controlled by domestic original equipment manufacturers (OEM), which collectively owned 70 percent of shipments in 2013. Here the Top 10 alone accounted for more than half of the total, and lesser names as well as mostly anonymous white-box smartphone suppliers are increasingly being marginalized.
The top smartphone shipper was Huawei Technologies with more than 50 million units, followed by Lenovo with 44 million and ZTE with 40 million. The new stars in 2014 will be Xiaomi, OPPO and vivo.
4G smartphones predicted to be popular in China include the Note 3 from Samsung, as well as the iPhone 5s from Apple. IHS expects Apple will sell more than 20 million iPhone units in China this year.
High-end smartphone models in China can go for more than 3,000 renminbi, or nearly $500, and the high-end 4G smartphone market will make up close to 40 percent of the entire 4G space in China this year.
Like the practice in the United States, the cost of smartphones is heavily subsidized by the carriers to help persuade consumers to buy new handsets.
Last year, the three operators spent a total of 27 billion renminbi (almost $4.5 billion) in subsidies for 3G smartphones, up 10 percent from 2012, which hurt net income for all three Chinese carriers.
The gray market for such handsets will decline to 183 million units this year, down from 200.3 million in 2013.
