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Samsung leads expanding Indonesian smartphone market

Samsung leads expanding Indonesian smartphone market

According to a new reports from the Canalys market research firm, Indonesia was the brightest spot in Asia Pacific’s 2018 smartphone market. Shipments there reached a record high of 38 million in the year, up 17.1% on 2017.

The market has made a complete recovery from its lowest points in 2016 (-3.3% annual growth) and 2017 (0.6% annual growth), when it was disrupted by the TKDN regulations. It grew consistently throughout 2018 and, despite a slowing momentum toward the end of the year due to the Rupiah weakening against the US dollar, performed much better than other countries in the region. In Q4 2018, total smartphone shipments reached 9.5 million units, with year-on-year growth of 8.6%.

“Indonesia’s smartphone market is in its prime,” said Canalys Research Manager Rushabh Doshi. “Rapid developments in the online channel have fuelled growth, as has consumers’ healthy appetite for upgrades. At the same time, new brands are joining the market. While the growth this year was partly a correction due to the slump in the last two years, Indonesia is back on top of the list of markets where smartphone shipments will continue to grow, due to a relatively stable regulatory and social environment compared with other emerging markets.”

Competition among vendors in Indonesia has increased dramatically, with the top five now commanding more than 80% of the market, against 65% a year ago. “Indonesia is truly a mobile-first market,” added Doshi. “The sheer size of its app-driven economy underlines the increasing importance of smartphones and will attract heavy investment from software and device vendors alike, encouraging new companies to join the fray.”

Canalys says Samsung strengthened its lead over Chinese and local players in Q4, growing 21.5% annually, above the market average, with over 2.4 million units shipped.

Xiaomi held onto second place, shipping nearly 2 million units to register 139.4% year-on-year growth in Q4, but a decline of 3.9% sequentially. For the whole of 2018, it shipped 8.0 million units against 2.0 million in 2017.

Canalys reckons Oppo is under tremendous pressure from Xiaomi in Indonesia and registered its slowest quarterly growth in the market since Q3 2017, 0.8% in the last quarter of 2018. The analyst house reckons Oppo faces an even tougher time in 2019 as Samsung resets its strategy to improve its mid-to-low-end line-up, while Chinese peers Vivo and Huawei catch up.

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