IFA: Smartphone manufacturers pin their hopes on new standard

IFA: Smartphone manufacturers pin their hopes on new standard
IFA: Smartphone manufacturers pin their hopes on new standard
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The IFA Berlin (Internationale Funkausstellung), which is currently being held in Berlin until 11 September, is regarded as one of the most important events for consumer electronics and communication technology. Innovations in mobile communication and smartphone technology therefore play a central role at the fair, with not only the latest models presented to the public, but industry trends and business developments very much in the spotlight.

In addition to foldable smartphones, the focus this year is on the 5G mobile data standard. The faster data connection is considered a hope for listed mobile communications companies, who have been facing challenges.

Trade dispute weighs on smartphone market

For one, the trade dispute between the USA and China is causing complications. Analysts expect sanctions against Chinese mobile phone manufacturer and leading network equipment provider Huawei to put a damper on the entire industry. While it stands to reason that market leader Samsung and Chinese rivals like Xiaomi will attract some of Huawei’s customers, Anshul Gupta of the market research institute Gartner says: “But I don’t assume that the declining Huawei sales will be completely absorbed by other players. This will cause the market to shrink even more.”

Gartner calculates a decline in smartphone sales of 1.7 per cent to 368 million devices for Q2, with demand for expensive models primarily accounting for the decrease: On the one hand, owners of top models see no reason to renew their devices, on the other hand, there are not enough incentives for users with mid-range phones to switch to more expensive models. Hopes now rest squarely on the 5G standard, with manufacturers feeling that the new technology could increase interest in new and more expensive smartphones.

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Foldable phones and other new technologies to boost sales

Samsung remained the clear number one in Q2 and, according to Gartner calculations, increased its market share from 19.3 to 20.4 per cent year-on-year. Huawei’s market share increased from 13.3 percent to 15.8 per cent, but its sales plummeted after the company was blacklisted by the US government in mid-May.

In addition, the two suppliers had to postpone the launch of their folding telephones, which are now expected to be available in autumn. While industry leader Samsung presented its Galaxy Fold at the IFA, Chinese competitor Huawei presented the Mate X. Samsung also announced the launch of a mid-range 5G smartphone.

Not only the manufacturers are hoping for a more dynamic smartphone market: the supplier industry also very much depends on it. One example of this is the Austrian semiconductor group ams AG, whose shares are listed on the Zurich Stock Exchange and came under some pressure in the course of the trade disputes.

In addition to the progress in the talks between the US and China, the rapid adoption of 5G infrastructure in individual countries and the demand for new mobile phones will be a deciding factor for the market – and particularly regarding the latter, expectations for the International Consumer Electronics Fair are set high.

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Legal note:
Prognoses are no reliable indicator for future performance.

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