Central and Eastern European Handset Market Close to Saturation, According to IDC | About IDC | IDC CEMA

PRAGUE, July 4, 2017 — The overall handset market in Central and Eastern Europe (CEE) is mature. Irrespective of exogenous economic factors such as oil prices, the handset market will expand at only a moderate pace this year. While the CEE mobile phone market grew 3.4% year on year in 2016, market growth will slow to 2.1% in 2017.

The situation on the devices market in the region is strongly shaped by developments in Russia. The Russian market, which has traditionally accounted for nearly one-half of the total CEE market, recovered considerably in 2016, despite weak overall economic conditions and the continuing low exchange rate of the rouble against the euro. "After a buying spree at the end of 2014 as the national currency went into free fall, the market was very quiet in 2015. In 2016, it picked up to its usual tempo, and the transition to smartphones resumed," said Simon Baker, program director for mobile phones at IDC CEMA. However, the prices of smartphones in Russia remained below those in other parts of Central and Eastern Europe (CEE) and well below prices in Western Europe. The average sales price (ASP) of an Android smartphone (without tax) was $122 in Russia in 2016, as compared with $192 in CEE and $333 in Western Europe. One reason for the lower ASP in Russia was that Long-Term Evolution (LTE)-standard smartphones comprised around only half of Russian smartphone sales in 2016. In the rest of CEE, more than two-thirds of smartphone sales were of LTE models last year. But the situation is changing rapidly — the volume of LTE smartphones sold in Russia last year doubled in comparison with 2015. The outlook for the Russian smartphone market depends heavily on the exchange rate and thus, indirectly, on oil and gas prices.

The Russian economy exerts a strong influence on the other countries of the Commonwealth of Independent States (CIS) and associated states, whose mobile phone markets also generally showed some signs of recovery in 2016, including the market in Ukraine. In Central European countries, the continuing theme of the market is that of playing catchup with the more developed markets of Western Europe, with which many share the same salient feature of operator-dominated mobile-phone retail. The proportion of smartphones with 4G/LTE rose to 77.6% in 2016 from 57.0% in 2015 across Bulgaria, the Czech Republic, Slovakia, Hungary, Poland, and Romania (combined data). The same figures for Western Europe were 92.8% and 82.3%, respectively.

In 2017, smartphones will account for almost 8 out of 10 mobile phones shipped in CEE. As such, the market for feature phones will continue to ebb, though it will by no means disappear entirely. The ASP of a feature phone continues to fall, and thus the feature-phone-to-smartphone price difference is widening, making feature phones increasingly affordable.

To learn more about the region's handset markets, check out our IDC Central and Eastern Europe Mobile Phone Tracker Results Analysis. This document is a quarterly presentation that summarizes the latest IDC European quarterly mobile phone tracker results for the CEE mobile phone market, which includes country level data. In this tracker, IDC follows more than 40 mobile phone makers across CEE, providing detailed shipment volumes, ASPs, and market values for each company.


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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. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 1,100 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries worldwide. For more than 50 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. For more information, please visit www.idc.com, email insights@idc.com, or call 508-872-8200. Visit the IDC Community at www.idc-community.com. To learn more about IDC's Customer Insights & Analysis Group, please visit www.idc.com/customerinsights.


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