IDC: Smartphone shipments to surpass 1 billion units in 2013, up 39.3% as average prices decline 12.8%

Worldwide smartphone shipments are expected to surpass 1 billion units in 2013, representing a 39.3 percent growth over 2012. Total smartphone shipments are expected to approach 1.7 billion units by 2017, resulting in a compound annual growth rate of 18.4% over the five-year period.

The latest predictions come from IDC. Here is the breakdown:

IDC says emerging markets including Asia/Pacific, Latin America, and Middle East and Africa (MEA) will all post market-beating growth rates from 2013 to 2017. While developed markets will see market share erosion, they will nonetheless see volume increases during the same time period. As a result, the worldwide smartphone market will continue to grow overall.

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While we know more smartphones are shipping every year, their pricing structure is rather interesting. In 2012, the average selling price of a smartphone was $387. In 2013, IDC expects the average selling price for smartphones to fall 12.8 percent to $337.

Furthermore, IDC predicts the trend will continue in the years to come, with the average selling price dropping to $265 by 2017. While the actual number is just a guess, it’s interesting the firm expects prices to continue falling for the same five-year period that smartphones shipments will continue to increase:

In emerging markets, IDC expects average selling price declines from 2013 to 2017, led by Asia/Pacific. The firm argues more customers will thus be able to afford smartphones for the first time, and even bypass purchasing feature phones altogether.

“The key driver behind smartphone volumes in the years ahead is the expected decrease in prices,” Ramon Llamas, Research Manager with IDC’s Mobile Phone team, said in a statement. “Particularly within emerging markets, where price sensitivity and elasticity are so important, prices will come down for smartphones to move beyond the urban elite and into the hands of mass market users. Every vendor is closely eyeing how far down they can price their devices while still realizing a profit and offering a robust smartphone experience.”

See also – IDC: Android hit 81.0% smartphone share in Q3 2013, iOS fell to 12.9%, Windows Phone took 3.6%, BlackBerry at 1.7%

Top Image Credit: Jung Yeon-Je/Getty Images