SYDNEY, AUSTRALIA – New findings from Telsyte’s Australian Smartphone Market Study 2014-2018 show there were 16 million smartphone users in Australia at the end of June 2014, an increase of 1.1 million over the previous six months.
Both the Android and Apple platforms grew in the first half of this year and together make up 93 per cent of the installed base of users.
While the Australian smartphone market is maturing, some 20 per cent of mobile phone users are still on regular mobile phones. Telsyte expects strong sales in the second half of 2014, driven by new devices and shortening average replacement cycles.
Strong sales expected in the second half of 2014
Telsyte estimates that 5.6 million new smartphones will be sold in Australia during the second half of 2014. The majority of sales will be to existing smartphone users, however, Telsyte estimates around 1.5 million new users will take up smartphones before the end of 2014.
Telsyte Managing Director Foad Fadaghi says the Australian smartphone market is dynamic and still up for grabs.
“Roughly a third of those intending to buy a new smartphone in the second half of 2014 have not decided on the platform they intend to purchase and around a third intend to switch platforms,” Fadaghi says.
Apple retains the highest repeat purchase intentions (70%) while Android has improved to over 60 per cent, closing the gap. Telsyte found Windows Phone 8 uptake remained steady as the lack of handset and brand options impacted faster adoption.
Phablets – or smartphones that Telsyte defines as having a screen size of 5.5 to 6.9 inches – are still a niche market, despite more manufacturers releasing larger-screen devices that blur the line between a smartphone and tablet.
Telsyte believes the phablet market hinges on the entrance of Apple which is expected to launch a 5.5 inch iPhone 6 later this year.
iPhone 6 “phablet” appeals to Australians
Telsyte believes a larger screen iPhone will be a strong strategy if Apple decides to release such a device later this year, and could help it reclaim some lost market share in Australia.
“Some 40 per cent of survey respondents that intend to purchase an iPhone 6 indicated they would only consider it if it has a larger screen,” Fadaghi says.
Telsyte research shows that one in five existing Android users that intend to purchase a new smartphone and are not planning to purchase an iPhone, indicated they would “change their smartphone purchasing decision” if a larger screen iPhone 6 became available.
However it’s not all one way traffic. Telsyte also found that around 10 per cent of those expecting to purchase an Android smartphone are currently using an iPhone.
Furthermore, Telsyte research shows that Android smartphones have now overtaken iPhones as the main devices purchased on contract from carriers, following strong carrier promotions and the reduction in iPhone subsidies.
Smartwatches and fitness bands abound
Telsyte has found that smartwatch adoption is still embryonic in Australia and 80 per cent of smartwatch users pair their devices with Android smartphones. Samsung is the market leader, although the product category might be accelerated with the arrival of an Apple “iWatch” in 2014.
Telsyte research shows that smart fitness bands are more popular than smartwatches. This is due to their lower price points and popularity as a gift. Fitbit is the market leader and only a third of fitness band users currently pairing them with iPhones.
More than 1 million smart watches and fitness bands (combined) have been sold in Australia according to Telsyte research.
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About Telsyte’s Australian Smartphone Market Study 2014-2018
The Telsyte Australian Smartphone Market Study 2014 is a comprehensive study which provides subscribers with:
- Smartphone market sizing, platform and vendor market shares and forecasts
- End user trends across devices, services and mobile media
- Purchase intentions
- Discussions on strategic issues including platform and manufacturer trends
- Product reviews and insights
In preparing this study, Telsyte used:
- Financial reports released by mobile carriers, manufacturers and service providers.
- Interviews conducted with executives from mobile operators, vendors, retailers, and channel partners.
- An online survey of a representative sample of Australians 16+ years of age conducted with 1,018 respondents.
- On-going monitoring of local and global market and vendor trends.
Telsyte delivers strategic insights and advisory services to businesses that are producing, or are impacted by, disruptive technologies. Telsyte publishes studies into emerging consumer and business markets and provides custom research and advisory services. Our market leading coverage includes mobility, enterprise IT, digital media and telecommunications. Telsyte is a wholly-owned independent business unit of UXC Limited. UXC is an ASX-listed Australian IT services company and the largest Australian-owned ICT consultancy firm with over 2,500 customer organisations in the private and public sectors across Australasia. www.telsyte.com.au
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