ASP (average selling price) of smartphones in emerging mobile markets including India will drop from $135 in 2014 to $102 by 2018, said IDC.
Globally, smartphone ASP will decline from $297 in 2014 to $241 by 2018.
In contrast, ASPs in mature markets are not expected to change significantly and modestly higher shipment volumes will not drive up overall revenues as each generation of flagship phones shows less and less differentiation from its predecessors.
The global smartphone market growth will shrink to 12.2 percent in 2015 as compared with 26.3 percent in 2014, said IDC.
IDC predicts that smartphone vendors will ship nearly 1.3 billion units in 2014 against 1.4 billion smartphones worldwide in 2015.
Unit shipments will be approaching 1.9 billion units in 2018, resulting in a 9.8 percent compound annual growth rate (CAGR) for the 2014–2018 forecast period.
Smartphone revenues will be hard hit by the aggressive pricing, resulting in a 4.2 percent CAGR over the forecast period.
“The impact of upstart Chinese players in the global market will be reflected in a race to the bottom when it comes to price. While premium phones aren’t going anywhere, we are seeing increasingly better specs in more affordable smartphones,” said Melissa Chau, senior research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker.
By 2018, Google Android OS will control 80 percent of global smartphones shipped and 61 percent of revenues, while iOS will control only 13 percent of volumes and 34 percent of revenues. New operating systems like Tizen and Firefox cannot compete on price alone.