News

Windows Phone To Make Incremental Gains Through 2018

• By Gladys Rama
• May 29, 2014

Microsoft's smartphone platform is slowly making inroads into the market shares of perennial leaders Android and iOS.

In IDC's revised forecast released Wednesday, the market analyst projected that while the top three smartphone platforms will retain their rankings over the next four years, Android and iOS -- No. 1 and No. 2, respectively -- will lose some ground while the No. 3 Windows Phone will continue to grow.

Windows Phone shipments are expected to pass 43 million in 2014, a jump of nearly 30 percent over 2013's volumes. Between 2014 and 2018, IDC projects Windows Phone's market share to increase from 3.5 percent to 6.4 percent, with shipments expected to reach 115 million in 2018.

"It is somewhat unclear what Microsoft has in store for its recent acquisition of Nokia, but an additional positive is the number of new OEM partners recently announced," IDC noted. Microsoft has considerably grown its stable of Windows Phone hardware partners since the start of the year; at February's Mobile World Congress event, the company announced nine new partners, many of them based in key emerging markets, followed by two additional partners announced at last month's Build conference.

IDC also pointed to the new features coming in Windows Phone 8.1 -- notably the "Cortana" voice assistant -- as another of the platform's strengths.

"At Microsoft's Build conference this year, the company announced a number of key features that had been visibly absent from the platform in the past," IDC said. "If more OEMs get behind the platform, and device portfolios continue to scale the cost spectrum, Windows Phone can continue to gain momentum."

Also, in line with growing demand for more affordable devices, IDC projects Windows Phone unit prices to fall from an average of $265 in 2014 to $214 in 2018 -- the largest drop among the top three platforms.

At the head of the smartphone market are the Google-backed Android and Apple's iOS. IDC expects Android's market share to hit 80.2 percent in 2014, though that number is projected to slip incrementally to 77.6 percent by 2018 "mainly as a result of Windows Phone growth."

However, Android device shipments will grow from 998 million units to over 1.4 billion units during the same period. In a market in which demand is increasingly being driven by cost competition, particularly in developing regions, Android "will undoubtedly remain the clear market leader," according to IDC. The cost of Android devices is expected to fall from an average of $254 in 2014 to $215 in 2018.

iOS devices, by contrast, will stumble due to their higher price. Shipments of iPhones are expected to reach 184 million this year, giving the platform 14.8 percent of the market. However, its share is projected to shrink to 13.7 percent by 2018, despite shipments growing to 247 million that year, due to market demand being focused on lower-cost phones.

"Apple continues to be strong in mature markets, where devices are heavily subsidized, but emerging markets are expected to drive overall market growth, and appetite for smartphones in these markets is at the sub-$200 level, significantly below Apple's selling prices," according to IDC, which estimates iPhone prices to fall marginally from $657 in 2014 to $604 in 2018.