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Businesses Hardware

The Smartphone Sales Slowdown is Real (axios.com) 182

Posted by msmash from the closer-look dept.
Earnings reports from Samsung and Qualcomm on Wednesday suggest a serious industrywide slowdown in smartphone sales. Samsung's report is especially telling, since it also makes displays and other components for Apple. From a report: The smartphone business is an incredibly crowded space, so a slowdown could lead to even steeper price competition. That's a potential short-term boon for consumers, but could put the hurt on a whole host of technology companies. Samsung's take: Its written outlook was terse and brief, but damning. Of its own phones, it said "[p]rofitability in the mobile business is expected to decline quarter-over-quarter due to stagnant sales of flagship models amid weak demand and an increase in marketing expenses to address the situation." Similarly, it cautioned of weak demand in its display and chip businesses, which supply components for both Samsung and its phone rivals, including Apple. Qualcomm's take: The phone chip giant also predicted a slowdown, cutting its forecast for 3G and 4G smartphones.
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The Smartphone Sales Slowdown is Real More

The Smartphone Sales Slowdown is Real

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  • Unsurprising (Score:5, Interesting)

    by Anonymous Coward on Thursday April 26, 2018 @03:31PM (#56508871)

    When my old phone (Samsung S4 note) does everything I need it to do, is quick enough and I managed to buy a replacement battery recently.

    I do not need a new phone, along with its misfeatures, learning curve, and expense.

    • Re:Unsurprising (Score:5, Insightful)

      by jbmartin6 ( 1232050 ) on Thursday April 26, 2018 @04:00PM (#56509107)
      This is just a normal phase in the lifecycle of any product. Eventually the product is good enough for the standard uses and there is no real gain in buying a new one when you don't have to. Same thing already happened to PCs. Until someone figures out a whole new use for them, sales will lag. Good managers should have a plan in place for this predictable phase.

    • Same with my old iPhone 6s. There are few things it doesn't do that the 8 or X does, other than animoji, and that isn't really a deal breaker for me.

      What phone makers don't realize is that they just hit where PC makers have been for the past decade: Phones are good enough that models from a few years back do the same function as flagship phones, so other than having a shiny new thing, it isn't really a thing to upgrade. Plus, people are finding that a midrange phone does what they need, even though it ma

    • Same here...currently using a Galaxy S5 Active. It does everything I need (and a lot of stuff I don't need). It was $199 on Amazon, has a replaceable battery ($15) and a headphone jack. Decent cases for it are in the $7 or $8 dollar range, unlike $35+ for an iPhone 6/7.

      I don't see any reason to buy a more expensive phone.

      • Re: (Score:2)

        by rtb61 ( 674572 )

        I am still nursing along a note 3. I look after stuff, so it still looks like new, although it's protective case is starting to look pretty ratty and still the original battery, it tends to go from 100% to 50% pretty fast but runs like normal after that. Not likely to replace it with another note, don't really use the stylus that much and I will always go a user removable battery. Sometimes when you want to reboot the phone, it is so much easier to rip the back cover off and flick out the battery, then hold

    • This exactly! I have a Sammy Note 4(which I bought used) and it does everything I need a phone to do. If I need more processing power, that is what a tablet or PC is for. More features and speed are wasted on small screens. Smartphones have just reached the point where there is no more need for improvements save the camera and no longer justify replacing every year. The market is saturated plain and simple.
  • and now that we know why iPhones get slow over time the sames true there. What I want is longer battery life, better connections and faster downloads. And we're a decade out from the last two (waiting for spectrum rollout) and I think we've peaked on battery life. I don't need a faster GPU. I really don't care what my phone games look like.

    • Re: (Score:2, Interesting)

      by Anonymous Coward

      Yeah, there's not a lot of difference between a $150 phone and a $700 phone once the GPU is removed from the equation.

      And now the cell phone promoters have learned that the replenishment rate of a product drops once it becomes "good enough", just like PCs.

    • Re: (Score:1)

      by Anonymous Coward

      Personally I'd be up for upgrading my phone right now, but it seems the phone manufacturers have decided they don't want to make a phone I want to buy. I'm on project fi, which gives me limited options to begin with. But I have a hard requirement of a headphone jack and no bloatware. I'd get a pixel 2, but....headphone jack? The Moto X has the bloat.

      Phone makers, maybe quit making shitty phones and give us what we actually want and we'd upgrade our phones. But as is, I'll keep my current one as It's go

      • Moto X is hardly bloated on software. Moto Actions and Moto Display are really light experiences and something I'd prefer over stock. I use Essential PH-1 which is less bloated than either the Pixels or the Moto X4 Android One phones.
    • Comment removed based on user account deletion

    • Re:There's not a lot of reason to upgrade a 'Droid (Score:5, Insightful)

      by msauve ( 701917 ) on Thursday April 26, 2018 @04:46PM (#56509483)
      The flagships are all pushing thinner phones with minimal bezels. F that. It's hard enough to handle a phone already without fat-fingering an edge and triggering some unwanted change.

      I want a thicker, easier to handle phone, and take the room to put the headphone jack back in, along with a larger removable battery and sdcard. Bonus if you have front facing stereo speakers in the bezels (with no display notch).

      • Re: (Score:2)

        by amiga3D ( 567632 )

        Buy a battery case. It gives you a thicker phone with some heft to it and a lot of extra power. Two problems solved.

        • Re: (Score:2)

          by msauve ( 701917 )
          Yeah. Leave a connector plugged into the charging port while carrying it around so it fails much faster than otherwise. That's a solution. For you.

          • Do they have any cases that can charge wirelessly on compatible phones?

          • Err no there's zero stress on the charging port for most battery cases. Also WTF you doing that is making your connectors fail. It's a phone not a cricket bat.

      • The flagships are all pushing thinner phones with minimal bezels. F that. It's hard enough to handle a phone already without fat-fingering an edge and triggering some unwanted change. I want a thicker, easier to handle phone, and take the room to put the headphone jack back in, along with a larger removable battery and sdcard. Bonus if you have front facing stereo speakers in the bezels (with no display notch).

        That's why I have a moto E4. It does what I want it to do, is easy to handle, and doesn't have stupid stuff. (And does have a headphone jack).

  • ...from my cold, dead fingers.

    • Re:They'll be prying my Samsung Galaxy S4... (Score:5, Insightful)

      by Bender1001 ( 5370707 ) on Thursday April 26, 2018 @03:53PM (#56509047)
      Replaceable batteries...miss those. Have a Galaxy S6 that works perfectly fine but needs a new battery soon which is gonna be a pain to replace.
      • Replaceable batteries are a hard requirement for anything I buy. This is not at all negotiable.

        • Re:They'll be prying my Samsung Galaxy S4... (Score:5, Interesting)

          by stevegee58 ( 1179505 ) on Thursday April 26, 2018 @04:48PM (#56509495) Journal
          Absolutely. Here's another example:
          My old Fitbit One is going to need a new battery soon but it's literally glued shut and can't be opened without breaking it. (Luckily my company bought it for me.) The new low-end replacement Fitbit has a replaceable battery so clearly somebody is listening. If the battery weren't replaceable I wouldn't even think about buying another Fitbit.

          • The new low-end replacement Fitbit has a replaceable battery so clearly somebody is listening.

            The Zip? It was released about the same time as the One and was always marketed as a lower end model.

            They dropped the One because they want to focus on watched based fitness trackers. What's the point of having a fitness tracker if everyone else doesn't know you have a fitness tracker?

            Even if it's not as accurate as a waist mount model.

          • Yeah, fuck replaceable batteries. I had them in my S4, and as time went on, it was more and more of a pain. I wore the case/cover out, and I spent a lot of mental tallying to make sure I was putting the dead one in and taking the full one out, and vice-versa. Replaceable batteries are just another thing you need to buy, have, keep track of, and plan around.

            I'm sold on the water resistant S7 I have now. Wireless charging saves the port which is what killed my S4, and when the battery is dead, the phone is de

        • So buy any phone then. You can get the batteries replaced at pretty much any phone shop.

    • How have you kept the charging port from dying?

      That's what pushed me to the S7 about 2 years ago. I thought I would hate the sealed battery, but being water resistant and doing wireless charging has changed my mind. I now know that I'm in a /. minority, but this is a place where I'm ok with the compromise.

      Yeah, another 1-2 years and this battery will be shit, and I'll need a new phone. But until that time, I'll drop it in a cradle or on a puck and it will charge, and if I drop it in a puddle it will still

    • I said the same thing, but even with replaceable batteries it was showing it's age in performance as apps keep bloating and demanding more space and more RAM.

      Upgraded to an LG last year and haven't looked back. It has user replaceable battery, and an audio jack, a much faster processor, far more RAM and storage. And I escaped the Samsung Touchwiz crapola as well.

  • Keep raising those prices! (Score:4, Insightful)

    by Anonymous Coward on Thursday April 26, 2018 @03:36PM (#56508921)

    I'm sure reaching/surpassing the $1000 mark for flagships has nothing to do with the decline in demand whatsoever! Keep making them more expensive while only adding minor new features and little performance.

    • Re: (Score:2)

      by torkus ( 1133985 )

      Especially since you can buy a nice laptop for that much too

    • Yeah I'm not sure what more i'd want out of a phone than what my iPhone5s does. If I was spending $1k on something I'd rather get a 2in1 or something. Once the phones can support a real i5/i7 or Ryzen maybe that'd be worth something, but then you'd still be stuck with a tiny screen. It'd be like spending 1k on an e-reader... you could but why?

    • Re: (Score:2)

      by nasch ( 598556 )

      Of course the $1000 flagships are not the entire market. It's not clear what percentage of people are only willing to buy a phone if it's top of the line, but aren't willing to spend $1000. For everyone else there are still phones to buy.

  • In other news (Score:4)

    by shmlco ( 594907 ) on Thursday April 26, 2018 @03:38PM (#56508927) Homepage

    And in other news: "China's smartphone market suffered its worst decline ever in the March quarter--an 8 percent YoY drop in unit sales--but Apple still managed to achieve 32 percent growth, directly attributed to "strong performance of its iPhone X.""

    Also, what Samsung actually reported in its display panel earnings statement for the March quarter was that "OLED Earnings declined due to weak demand AND [note] rising competition between Rigid OLED and LTPS LCD."

  • Like post core2 duo pc's (Score:3)

    by OffTheLip ( 636691 ) on Thursday April 26, 2018 @03:38PM (#56508929)
    Not that much has really changed regarding performance for the average PC user. It's good enough so why upgrade. Phones are now experiencing the same thing. Plus they are very expensive.
    • Comment removed based on user account deletion
    • Comment removed based on user account deletion
  • What do companies and investors want? For each individual to own dozens of smartphones? I have never understood this worship for growth at any costs, and for punishing companies that do not growth, for any reason. No wonder the market behaves as if it were in the hands of a baby.

  • Why should this be surprising? (Score:5, Insightful)

    by IGnatius T Foobar ( 4328 ) on Thursday April 26, 2018 @03:47PM (#56508995) Homepage Journal
    No one should be surprised. We saw this happen with computers and now we're seeing it happen with smartphones. The market is saturated, the existing installed base is more than capable of handling most workloads, and therefore fewer people are motivated to upgrade every year. You want us to buy new phones? Build them with longer battery life and less crapware/spyware. The screens are already good enough. The cameras are already good enough. The operating systems are already good enough. Gee-whiz bells and whistles aren't going to motivate us to upgrade anymore. And stop building phones with notches.

    • Comment removed (Score:4, Informative)

      by account_deleted ( 4530225 ) on Thursday April 26, 2018 @04:21PM (#56509287)
      Comment removed based on user account deletion

      • The problem is that there are very few good unlocked phones and they are very difficult to research.

        This is just false. Most phones are unlocked these days. Carriers have dropped subsidies for new phones. They offer 0% financing but not subsidies.

        If you want to research, try a little known site called Amazon.com and search for Android phones. All of them there are unlocked.

      • Not sure why you're modded so high.

        The problem is that there are very few good unlocked phones and they are very difficult to research. It is a major barrier.

        Almost every carrier locked phone has an unlocked version you can get quite easily. Walk into best buy, find the phone you like, and if best buy doesn't sell the unlocked version (they probably do) then go buy it online.

        I found the Huwaei phones which are great but you won't be able to get those in the US soon. These phones made it very simple. They are feature/spec parity with the flagship phones and are built very well. They work internationally and in the US.

        No surprise they got banned. The two major carriers are very powerful in Washington DC.

        You have no idea what you're talking about. By that logic OnePlus is next in line to get banned.

    • And the new phone they got last year lasted less time then the one before, so they are afraid of the next one!

  • Comment removed (Score:4, Insightful)

    by account_deleted ( 4530225 ) on Thursday April 26, 2018 @04:04PM (#56509137)
    Comment removed based on user account deletion

    • Re: (Score:2)

      by amiga3D ( 567632 )

      My LGV20 has removable battery. I bought two spares with a charger on Amazon for next to nothing. Now I just change batteries, I never use the cell charger. I keep one spare in the house and one in the car. I'm never tied to a cord any more. When it hits 20% I swap and put the battery in the charger and keep moving. Too easy.

    • Every Samsung phone has a replaceable battery. What you seem to want is a user exchangeable battery. Can't imagine why though.

  • ---and as spares I bought 2 second hand for nix off TradeMe (eBay equiv in NZ). The newer models have higher res (but beyond my unassisted resolution), better cameras (my one is good enough), faster/more cores (no processing issues) and more RAM (well that's something that would help but not a show-stopper yet).

    There's just no good reason for me to change yet... And I won't be crying if I break it... just swap in more bits from the other carcasses. When I can't fix it any more... well then I'll upgrade

  • Memory prices. (Score:3)

    by MrL0G1C ( 867445 ) on Thursday April 26, 2018 @04:28PM (#56509341) Journal

    Good, now maybe memory prices can come down a bit.

    • The markup on internal phone memory is pretty absurd.

      • Re: (Score:2)

        by MrL0G1C ( 867445 )

        No, the markup on PC DDR is getting absurd, the reason given that it is made in the same factories as mobile phone memory and that supply and demand (of mobile phone memory) is pushing the price up.

        The companies making DDR have been busted in the past for operating a cartel, it looks like they're doing it again. There are very large profit margins on DDR, $5+ profit per 8-Gigabit chip IIRC.

  • Is anyone surprised? (Score:2, Insightful)

    by roc97007 ( 608802 )

    It's common in the technical industry for a product to start out with a steep profit margin as large gains are made in functionality and performance. As the technology matures, the performance and functionality curves level out, with each new iteration having fewer compelling features. Manufacturers will try to keep this going with "changes for the sake of change" (Flat icons! no, 3d icons! No really, flat icons! No, animated icons!) but that typically only extends the phenomenon another couple of iter

  • FEATURES! (Score:5, Insightful)

    by sdinfoserv ( 1793266 ) on Thursday April 26, 2018 @04:38PM (#56509419)
    There's no new MUST HAVE features on the new model phones. Thus no impetus to spend money on them. Once 5G starts widely rolling out, there may be surge again, but my guess is the carriers will charge / throttle 5G nearly out of existence so that may not be all that cool either.

    • This. Wish I had mod points.

      It's the same thing that happened with tablets and desktops.

      "I bought this for $800 three years ago. It still mostly does what I need. The new one is $1000 and doesn't have anything I'm willing to spend $1000 to get."

    • Re:FEATURES! (Score:5, Insightful)

      by DRJlaw ( 946416 ) on Thursday April 26, 2018 @07:42PM (#56510397)

      Once 5G starts widely rolling out, there may be surge again, but my guess is the carriers will charge / throttle 5G nearly out of existence so that may not be all that cool either.

      No, there won't. 5G essentially requires near-line-of-sight. In a world (meaning the US) where companies won't even invest in consumer fiber deployment any longer, the idea of high density 5G cells providing NLOS connectivity is laughable. A 5G cell phone will have minimal advantages over an LTE cell phone with WiFi connectivity at the home and office (which also offers the advantage of not burning through the pitiful cell data allotment).

  • Smartphones are dying (Score:4, Funny)

    by WaffleMonster ( 969671 ) on Thursday April 26, 2018 @04:40PM (#56509433)

    Downturn in sales confirms smartphones are dying. In the future there will be no smartphones. Those of you who still have smartphones are dinosaurs stuck in the past.

  • I for one would probably have invested a 4-digit number of bucks into new smartphones, had the industry offered me something not ridiculously oversized. I am not blind or fat-fingered. I do not want to carry a brick around. So I had to stick with my many years old smartphones, from an era when small smartphones were still on offer.

    And if you have a look at the crowd-funding success of e.g. the Jelly phone, I am not quite the only one fed up with today's XXXL bricks.

    • It's nice to find I'm not the only one who feels stupid talking into a "slab of toast". A mobile phone is supposed to be just that - *mobile*, not a computer you have to lug around. For that reason, my primary phone is still a flip phone.

      Only reason I'm looking to migrate to a "bloatphone" is that my work finally blocked personal email access, so I'd like something on which I can monitor email. But it has to be small & I'm not laying out hundreds of $$. Anything larger than, say, a Moto G is too big (

  • I paid my Note 4 around 700 €. I would happily be geeky and buy a Note 8, although I don't like the screen ratio and the rounded edges (what for ???).
    But a little more than 1000 € for a Note 8 ? Are you crazy Mr Samsung ???
    What's next ? A Note 9 with a stupid notch for 1300 € ?
    No, I'll keep my money and I'll have a look at alternative OS like http://www.resurrectionremix.c... [resurrectionremix.com] when time comes.

  • My Moto X pure has 5.7 inch screen, which is great for my old eyes. So the thing touted as the next generation model has

    1. same CPU
    2. same GPU
    3. same RAM
    4. smaller screen, 5.2 inches
    5. costs $100 more

    I'm just curious if Motorola is wondering why no one wants to "upgrade"

    • oh I forgot the camera on "the next generation model" has 12M pixels, while mine has 21M. WTF??!!!!

  • You've saturated the market, there are few possible new customers who don't already have a working device and see no reason to buy a new one.

  • Can we start calling them smartcameras? My actual phonecalls account for 0.001% of use, as do most others!

  • My old phone was a Galaxy S5. The issue was that it was short of RAM and short of storage. The thing was constantly swapping and slow has hell, and updating apps was hard because I was so short of storage.

    But I upgraded to a reconditioned S7, for 1/3 the price of a new S9. I just can't justify paying for the brand new latest/greatest.

  • I think it was a bit more than two years ago that most carriers stopped offering two year contracts that gave a nice discount on the phones. I bet the phone industry is just starting to see the slowdown from that as everyone who might be shopping for something new is seeing the high price tags of a brand new phone. I have an iPhone 6S Plus and it still works great, does all I need it to do. Sure, the new one has a faster CPU and better camera... but it's not $800-$1000 out of my pocket better. If there were

  • Using a very old iPhone 4S that is fine for my rare usage.

  • Cost is a factor, less so for the devices, but more so for the service. Especially in the US prices for cell service are obnoxiously high for rather spotty coverage. That means that those who have one won't buy a new one every year and those who do not have a smartphone won't buy one, even if they could afford a device, they will shy away from the high monthly prices. Cost aside, for some there are not many use cases that make such investments reasonable. Landlines and wired Internet are not only cheaper, t
  • Nearly everybody who wants a smartphone already has one. And the ones that most people have are Good Enough so there is less incentive to upgrade. We've seen the same cycle with other tech products like PCs; there was no reason to believe that smartphones would be an exception.

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