Feature phones steep decline to impact mobile ecosystem
The mobile ecosystem is expected to be altered negatively following the continuous steep fall in the adoption of feature phones in Nigeria and other part of the globe.
Feature phone is said to have reached its maturity with most consumers upgrading to smartphones lately.
Euromonitor International, a strategic market research, data & analysis firm, said the wide availability of second-hand feature phones and smartphones imported from developed economies such as Europe, which is expected to continue over the forecast period due to greater affordability, will also limit the potential growth of new mobile phones in Nigeria.
In the report obtained by The Guardian, as at August, phone manufacturers have sold 18.5 million units in Nigeria with Infinix brand having the largest chunk of the market with 75 per cent share.
Samsung is next with 7.6 per cent and Huawei with three per cent.
The research firm said over the forecast period, Smartphone is expected to record strong volume growth due to the desire for more technologically advanced mobile phones by the young adult population including the Z generation.
According to Euromonitor, smartphone grew by 10 per cent in retail volume terms in 2018 to reach six million, while feature phones records five per cent retail volume growth in 2018 to reach 12 million units.
The mobile ecosystem is expected to be charged up competitively following the influx of Chines manufactures and domestic players such as Zinox Technologies and AfriOne, among others.
These companies are expected to lead strong price competition, with the Chinese firms offering cheaper smartphones for different segments of the population, particularly low end and middle income consumers.
Euromonitor noted that the price competition will help drive volume sales of smartphones over the forecast period.
The report observed that Transsion Holdings with its Tecno and Itel brand dominates feature phones sales in Nigeria in 2018 because of its strong presence, distribution networks, availability and variety of affordable feature phones.
Euromonitor noted that premium brands such as Apple, Samsung are still struggling to grow volume terms due to slow economic recovery after recession.
It however, said Apple increased volume share in 2018 due to launch of the iPhone X late in 2017.
According to the market research firm, although domestic manufacturers are only present in the mobile phones, international players still dominate with a near monopoly presence, but that nevertheless, companies such as AfriOne, which launched the first locally made smartphone in April 2017, have scope to succeed.
Challenges to success include the high production cost in Nigeria caused by lack of adequate infrastructure, but with future improvement, especially in the power sector could compete favourably with international players and produce more affordable brands to meet the needs of low-income consumers.