Philippines remains fastest-growing smartphone market in SEA, report says

With a stellar three-fold growth in smartphone volume sales in the past year, the Philippines retains its title as the fastest growing smartphone market in Southeast Asia, according to a report released by research firm GfK on Monday.

The Philippines likewise posted a massive jump in the share of smartphones in the overall mobile pie in just a year, GfK noted, with its share increasing from just 9 percent last year to 24 percent today.

The adoption of smartphones in the country outperformed neighbors Thailand and Vietnam, which has a relatively low 19 percent and 11 percent adoption rates, respectively.

In May, GfK reported that the Philippines boasted the highest growth rate in terms of smartphone adoption in the first five months of the year, thanks to affordable Android smartphones.

The Philippine trend followed marked growth in smartphone sales in all of Southeast Asia, posting a high 61-percent surge in volumes to total 29 million units sold in the last 12 months.

GfK findings point to a greatly increased smartphone consumer purchase rate by 78 percent across the seven countries, accounting for over 61 percent of the sector’s overall value in Southeast Asia.

Despite this, feature phones or entry-level phone — mobile phones that do not have a modern mobile operating system built-in — continue to take the lion’s share of the entire mobile market in the region, as customers bought another 10 million units during the period.

“Feature phones still reign as the more prevalent mobile phone type used by consumers in the region’s emerging markets,” said Gerard Tan, account director for digital technology at GfK Asia.

“However, smartphones adoption is escalating at a rapid pace with individual country’s growth rates reported in the range of 42 to 326 percent,” he added.

For example, in Indonesia, which currently has the largest smartphone market in the region, nearly four in every five mobile phones sold are still feature phones “due to their greater affordability,” the report noted.

Findings also showed that smartphone growth in the region is driven primarily by the more affordable devices priced in the range of $100 to $200, which is currently dominating the market.

Dominated by a low-income group of mobile users, the Philippines has been an ideal country for launching affordable smartphones, such as those from Samsung and local brands such as Cherry Mobile and MyPhone, with Android-based phone models retailing below P5,000 levels.

Moreover, with mobile vendors signifying interest to manufacture more low-end smartphone models, GfK’s Tan said the industry could only expect feature phone owners migrating to smartphones anytime soon.

“The device will be within the reach of an even larger pool of consumers and the market expected to grow even faster when these models are made widely available,” Tan said. “We expect to see continued robust growth for at least the next two years.”-Black Pearl Media (September 18, 2012)