Apple regains 2nd spot in global smartphone market, Xiaomi slips to 3rd

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SME Times News Bureau | 15 Oct, 2021
Apple regained second place in the global smartphone market with 15 per cent share in the third quarter (Q3) this year, thanks to strong early demand for iPhone 13, a new report showed on Friday.

Samsung was the leading smartphone player with 23 per cent share. Xiaomi took 14 per cent share for the third place, while vivo and OPPO completed the top five with 10 per cent share each, according to preliminary data provided by global market research firm Canalys.

Global smartphone shipments fell 6 per cent in the third quarter (July-September period) this year, as vendors struggled to meet demand for devices amid component shortages.

"The chipset famine has truly arrived. The smartphone industry is striving to maximise production of devices as best it can. On the supply side, chipset manufacturers are increasing prices to disincentivize over-ordering, in an attempt to close the gap between demand and supply," said Canalys Principal Analyst, Ben Stanton.

Despite this, "shortages will not ease until well into 2022. As a result of this, as well as high costs of global freight, smartphone brands have reluctantly pushed up device retail pricing", Stanton stated.

"At the local level, smartphone vendors are also having to implement last-minute changes in device specification and order quantities. It is critical for them to do this and maximise volume capacity, but unfortunately it does lead to confusion and inefficiency when communicating with retail and distributor channels," he added.

Many channels are nervous heading into important sales holidays, such as Singles' Day in China, and Black Friday in the west.

"Channel inventories of smartphones are already running low, and as more customers start to anticipate these sales cycles, the impending wave of demand will be impossible to fulfill," Stanton added.

Customers should expect smartphone discounting this year to be less aggressive.

"But to avoid customer disappointment, smartphone brands which are constrained on margin should look to bundle other devices, such as wearables and IoT, to create good incentives for customers," Stanton said.