02 Mar 2021
The iPhone 12 has triggered the highest number of device upgrades in the history of the iPhone, and propelled Apple to #1 for global smartphone sales.
In the final three months of 2020, the smartphone market globally began to rebound from pandemic lows and the iPhone 12 led the charge.
Apple claims #1 market share position from Samsung
For the first time in four years, Apple moved ahead of Samsung to claim the top spot for global smartphone sales.
While Apple celebrated year-on-year quarter growth of almost 15%, Samsung's numbers headed in the opposite direction with a decrease in sales of almost -12%.
Two points worth noting... Apple secured these outstanding results despite the iPhone 12 not being released until midway through the quarter; and Samsung is expected to bounce back due to the release of the S21 in Q1 of this year.
iPhone 12 triggers 'supercycle'
The release of the iPhone 12 has triggered a 'supercycle' - defined as when significantly more consumers upgrade to a new model device.
The last supercycle is widely recognised as occurring in 2014 when Apple first introduced the iPhone 6Plus with its bigger screen meeting demand for a 'phablet' type device.
“Both switchers and upgraders increased on a year-on-year basis” and Apple saw “the largest number of upgraders that we’ve ever seen in a quarter.”
Tim Cook, Apple CEO
Market analysts had been predicting the possibility of a super cycle due to the large number of consumers holding onto older iPhones. Analysts estimate that 30% or more of current iPhone owners are using a device that’s at least 3 years old.
The upgrade surge has also been spurred by the choice of four different iPhone 12 models at a range of price points. Apple has reported a higher than anticipated number of consumers opting for the more expensive 12 Pro and 12 Pro Max models.
Meanwhile, removing the wall charger and earplugs from the iPhone 12 has allowed Apple to hold pricing, even with the inclusion of 5G.
Surge led by "pent up demand" for a 5G iPhone
Apple CFO, Luca Maestri, and Cook have both suggested the sales numbers reflect a pent-up demand for the first 5G-enabled iPhone.
Apple has been slow to bring a 5G-compatible iPhone to market - a full 18 months after Samsung's S10 arrived in Australia in May 2019.
However, Canalys analyst, Vincent Thielke believes that Apple is better positioned on 5G than its rivals because its sales model is heavily slanted toward developed markets and sales through mobile carriers.
Tim Cook agrees, saying Apple has more room to grow... "Everybody doesn't have an iPhone."
He also noted the iPhone does not have a majority share in any market and he highlighted developed markets with advanced 5G roll outs as targets, specifically mentioning India.
Device buy-back deals also a factor in upgrades
A number of carriers globally, as well as Apple itself, are also offering credits for trading in older iPhones. This has also been a motivating factor for some upgrading consumers.
Upgrading from an iPhone 7 could attract a trade-in credit of up to A$125 from Apple, while an iPhone X might secure a credit of up to A$370.
Australian business can also take advantage of a Telstra approved buy-back program which provides secure disposal of corporate devices and realises a commercial benefit. Learn More | Request A Quote
Recovery of smartphone market is "impressive"
Global analytics agency, IDC, has called the recovery of the smartphone market and supply chain impressive.
Though most of the world is still in lockdown mode, smartphone sales have steadily rebounded.
"This illustrates the importance of smartphones in everyone's life and provides a strong foundation for market demand, As the world progresses towards a post-pandemic environment, IDC believes demand will grow and the market recovery will accelerate."
Ryan Reith, program VP for the IDC Worldwide Mobile Device Trackers unit
About MobileCorp
MobileCorp is a Sydney-based communications technology company. We support enterprise and business by providing managed endpoints and ICT services including mobile device security, mobile device management, expense management and managed connectivity solutions. We are also a Telstra Platinum partner and partner with all the leading technology companies, Microsoft, AWS, VMWare, Apple, and more.
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