Bangladesh Smartphone Shipments Down 15% in 2018, Vendors Bet on Android Go for Future Growth: IDC

According to the International Data Corporation's (IDC) Asia/Pacific Quarterly Mobile Phone Tracker, Q4 2018 mobile phone vendors in Bangladesh shipped a total of 28.5 million units in the year 2018, resulting in a year-over-year (YoY) decline of 17%. 6.9 million units smartphones were shipped in 2018, down from 8.1 million units in 2017. This was the first time when both smartphone and feature phone categories saw negative growth in the country. Feature phone segment still remains the dominant category with 76% share but its shipments slipped to 21.6 million units in 2018 compared to 26.1 million in 2017.

4G services were launched by telcos in Bangladesh in Q1 2018. However, due to the limited coverage of the 4G network and the higher price of 4G enabled smartphones, the uptake of 4G smartphones in the country has been slow. Telecom operators initiated a couple of partnerships with the device makers to sell affordable co-branded smartphones in the country, to upgrade the lower generation users to the 4G network. However, this wasn't a strong catalyst for the smartphone category to maintain its ongoing growth from 2017 to this year. This did help telco as a channel to double its shipments in 2018. Retail remained the dominant channel accounting for 9 out of 10 smartphones sold in the country.

Mobile phone vendors also struggled to manage their pricing against the increased duty structure in the country. The larger impact of increased customs duty was seen in the feature phone category, where the small local vendors were unable to absorb the higher cost, and lost the share to Transmission and HMD (Nokia) in the lower tier cities.

Quarter Highlights (Q4 2018) - Smartphone           

The smartphone category ended with a flat 2% quarter-over-quarter (QoQ) growth in Q4 2018. The strong growth of Android Go edition smartphones helped to sustain smartphone shipments in the country. The share of Android Go smartphones increased to 43% from 29% in Q3  2018, an impressive 51% QoQ growth in Q4 2018. HMD was the first player to launch the Go edition smartphone in the country. However, Symphony, a local player, quickly identified the potential in the market and swiftly moved its portfolio to Go edition smartphones, thereby leading the category with a 39% share in this segment in Q4 2018. Another local player, Maximus also launched 4G enabled Go edition devices in an exclusive partnership with the local operators and sold these devices at a subsidized rate to make 4G smartphones more affordable in the country.

Jaipal Singh, Associate Research Manager, Client Devices, IDC India said that they expect more vendors to include the Android Go smartphones as a part of their device strategy as it allows the vendors to keep hardware cost low without compromising much on the experience. He further added that as the market is very price sensitive, it is difficult for vendors to upgrade to higher specifications which also command a higher price. However, Android Go is working here as a rescue catalyst.