Russia Takes Lead on EMEA Smartphone Market

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International Data Corporation's (IDC) Quarterly Mobile Phone Tracker says Russia’s mobile phone market expanded in 2016 and was the top European market by volume. 

The tracker found that the 30.66 million smartphones sold in Russia was the highest total of any European country last year. The Russian mobile phone market grew by 8.6% in volume (to 42.40 million units) and by 12.8% in dollar value year on year (to $5.33 billion). In contrast, most European markets contracted. 

The Russian market recovered strongly in 2016 despite weak overall economic conditions, said Simon Baker, IDC program director for mobile devices in Central and Eastern Europe, the Middle East, and Africa (CEMA). “After a buying spree at the end of 2014, as consumers rushed out to buy expensive smartphones before the prices rose in rubles as the national currency went into free fall, there was a very quiet market in 2015,” Baker said. “In 2016, the market regained some of its usual tempo and the transition towards smartphones resumed.” 

One longer-lasting impact of the 2014 ruble crisis is that the average prices of smartphones in Russia are below those in other parts of Central and Eastern Europe (CEE) and well below prices in Western Europe. The average sales price of an Android smartphone (without tax) was $122 in Russia in 2016; in CEE, the average price was $192, and in Western Europe it was $333. 

One reason for the lower Russian prices was that Long Term Evolution (LTE)-standard smartphones comprised around half of Russian smartphone sales in 2016. In the rest of CEE, more than two-thirds of sales were of LTE smartphones, and in Western Europe it was more than 90%. However, the volume of LTE smartphones sold in Russia in 2016 doubled over 2015.

Samsung maintained its position as the smartphone market leader in Russia, responsible for 21.6% of sales, down slightly from 2015. Apple had strong results, with its smartphone share returning to double figures after dropping in 2015. Apple accounted for more than one-third of the value of the Russian smartphone market.

Major Chinese brands had a mixed year. Huawei gained, as did ZTE. But Lenovo's share was little more than half of what it claimed in 2015. Alcatel's share also declined. Newer and second-tier Chinese brands were more prominent in Russia in 2016, among them Xiaomi, Meizu, and LeEco. India’s Micromax, which offers very price competitive LTE handsets, had a 4.9% share.

“Though the top end of the market remains strong, nearly half of the smartphone market now consists of devices with a sales price of less than $100 without VAT”, said Natalia Vinogradova, senior analyst for mobile phone research at IDC Russia.

The popularity of smartphones with a screen diagonal of five inches or more has increased. Many Russian buyers use such devices as tablets, said Vinogradova, adding that the five to 5.5-inch screen size is the most popular on the market. 

Baker said that while Russia's smartphone market recovered in 2016, the growth may be short-lived. “Once the 4G replacement cycle is over," he said, "Russia may also see the same slowing in shipments that is already clear in Western Europe, where the decline in product innovation is resulting in longer replacement cycles and thus slower sales.” 

About IDC 

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world's leading technology media, research, and events company.