Taiwan’s 4G subscribers will exceed 10 million in 2015: IDC

Market researcher International Data Corp (IDC) said on Dec. 11 that the total amount of the 4G subscribers in Taiwan will top 10 million next year, as telecoms’ flat rates and strong sales of new smartphones, such as the iPhone 6.

IDC originally projected that there could be one million 4G users by the end of 2014 but the actual figures could hit 3.3 million.

“Over the past seven months, the uptake of 4G in Taiwan has been stunning. The growth has greatly surpassed our expectations,” said Andy Ye (葉振南), IDC analyst.

During the first year for 4G operations, Ye said, Taiwan’s 4G penetration rate surged to 11.2%, which was a faster adoption rate than Hong Kong’s 6.7% and Korea’s 2.3% in the early stages of 4G deployment.

The analyst also attributed Taiwan’s rapid uptake to telecoms offering flat rates for unlimited Internet access to grab market share. Also, sufficient and various mobile devices for the 4G system also gave a boost to the business, he said.

Taiwan is the first country in the world to deliver 4G services on the 700MHz bandwidth, he said.

More and more people use their handheld devices to shop online

Ruten.com, an auction website that was established by PC Home Online and eBay (NASDAQ: EBAY), said on Dec. 11 that its transaction volume increased by 15% year-on-year because of the increasing use of handheld devices.

“More than 75% of buyers browse our page by handheld devices and 45% of them make purchases through smartphones or tablets,” said Vicky Tseng (曾薰儀), chief operating officer for Ruten.

Quoting a recent survey, Tseng said that Ruten’s pageviews via mobile devices surged 87% from last quarter, while the number of unique visitors rose 77% quarterly.

Echoing Ruten’s remarks, International Data Corp (IDC) said that the growth in smartphone and tablet use in the Asia-Pacific region showed that an era of mobile commerce is emerging. The report said that China’s Singles’ Day sales on Nov. 11 saw more than 40% of all transactions completed on mobile devices. For 2015, more than 50% of consumer transactions will be carried out via handheld devices, the report said.

TRI raises Taiwan’s GDP growth forecast

The Taiwan Research Institute (TRI) raised its forecast for the nation’s 2014 GDP growth and expected the pace to gain modestly next year as the global economy enters an era of great moderation.

TRI, a Taipei-based think tank, elevated its projection for GDP growth to 3.36% this year, from 3.1% estimated in June.

Wu Tsai-yi (吳再益), president for TRI, said that U.S. economy’s recovering is favorable for Taiwan’s exports, which was also one of the reasons for the nation’s GDP growth.

Wu said that the GDP growth might rise to 3.43% next year. He said that Taiwan used to outperform the world economy in terms of GDP growth, but the gap has tapered off in recent years, as Taiwanese firms increasingly lose their competitive edge and the government fails to provide substantial assistance.

People’s Bank of China pushes banks to lend more

People’s Bank of China, the nation’s central bank, has increased the nation’s annual new loan target to US$1.62 trillion, from previous local media estimates for the figure.

An anonymous source said that Chinese banks have disbursed US$109.7 billion of loans between January and October so they will have to quicken their pace before the end of this year, if the central bank has indeed raised the target.

The amount of new loans issued by Chinese banks fell by more than a third in October.

Uncertainty for the future Hong Kong electoral reforms

The prospects for compromise over the future of Hong Kong’s electoral system remained unclear after the clearing of Occupy Central’s base camp from Admiralty district, with protesters and government officials’ demands still essentially at odds.

Officials signaled some willingness to negotiate on the makeup of the nominating committee that would vet candidates for chief executive in Hong Kong’s first election in 2017.  But both student protestors and pro-democracy lawmakers said that they will reject any proposal that requires candidates to be approved by a Beijing-controlled nominating committee.

Twelve Chinese IPOs unexpectedly approved

A total of 12 initial public offerings (IPOs) were unexpectedly approved by China’s securities regulator on Dec. 11.

The IPO approvals include budget carrier Spring Airline’s US$234 million listing, and medium-sized Chinese brokerage Guosen.

The regulator’s decision could dampen the surge in China’s stock markets, as the benchmark Shanghai Composite Index has spiked over 30% in the last two weeks amid speculation the central bank will further ease monetary policy.

Billions of dollars have flowed into the market, giving the regulator space to accelerate the pace of IPO approval without over-diluting valuations of existing shares.

The post Cross-strait News Daily Round-up for Dec. 12 appeared first on VR World.

International Data Corp’s (IDC) latest mobile phone forecast said that worldwide smartphone shipments will reach a total of nearly 1.3 billion units in 2014, representing an increase of 26.3% over 2013.

IDC, meanwhile, expects 1.4 billion smartphones to be shipped worldwide in 2015 for a 12.2% year-over-year growth rate. Slower annual growth continues throughout the forecast with unit shipments approaching 1.9 billion units in 2018, resulting in a 9.8% compound annual growth rate for the forecast period between 2014 and 2018.

Melissa Chau, senior research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker, said that 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 are not going anywhere, we are seeing increasingly better specs in more affordable smartphones,” she said. “Consumers no longer have to go with a top-of-the-line handset to guarantee decent hardware quality or experience. The bigger question now is how much lower can prices go?”

IDC’s report said that on a worldwide basis, smartphones are expected to have an average selling price of $297 worldwide in 2014, and it will drop to US$241 by 2018. Emerging markets, such as India, will see much lower smartphone prices around $135 each but will fall to US$102 by 2018. The report said, however, the prices 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.

IDC said that Android devices will continue to drive shipment volumes from an operating system perspective, while iOS devices drive revenues. By 2018, Android will control 80% of global smartphones shipped and 61% of revenues, while iOS will control only 13% of volumes and 34% of revenues. With Android volumes so dominant, IDC said, it is no longer a possibility for new operating systems like Tizen and Firefox to compete on price alone.

“As shipment volume slows, we expect greater attention to shift toward value trends,” said Ramon Llamas, research manager with IDC’s Mobile Phones team. He said that Apple’s approach with premium pricing ensures a growing portion of overall revenues despite its declining market share. Meanwhile, Android’s multi-faceted approach, with forked versions and low-cost Android One strategy, will produce mixed results, yet it allows deeper penetration into merging markets.

“That can lead to additional pressure on its vendor partners, who will need to seek greater differentiation in terms of devices and experiences in the hyper-competitive smartphone market,” Llamas said.

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It’s been common knowledge for quite some time that the tablet market is shrinking, and now a new report from IDC quantifies exactly how steep that decline is.

According to IDC’s data, the tablet market’s year-over-year growth has slowed from 52.5% in 2013 to 7.2% in 2014. IDC’s analysis of the market leads it to believe that the reason for this slowing growth is the extended lifespan of the tablets themselves, as users are hanging on to them longer. The lifespan of the devices, according to IDC, is beginning to resemble PCs as opposed to smartphones.

“The tablet market continues to be impacted by a few major trends happening in relevant markets,” said Ryan Reith, Program Director with IDC’s Worldwide Quarterly Mobile Device Trackers. “In the early stages of the tablet market, device lifecycles were expected to resemble those of smartphones, with replacement occurring every 2-3 years. What has played out instead is that many tablet owners are holding onto their devices for more than 3 years and in some instances more than 4 years.”

Growth for the market, according to IDC, will largely be in the developing world as these markets still have an appetite for low-cost devices (as many consumers are largely skipping PCs altogether.

IDC’s data shows that Android is still the dominate tablet platform, controlling 68% of the market.This is up 16% from last year. Apple’s (NASDAQ:APPL) iOS is in second place with 27.5% of the market, which is a decline of 12.7% from the same time last year. Windows, despite its massive year-over-year growth of 67.3% only has a sliver of the market with 4.6%.

IDC also notes that the detachable “2-in-1” form factor devices have not made the inroads expected by Intel (NASDAQ: INTC) and Microsoft (NASDAQ:MSFT). IDC’s forecast is only for 8.7 million units to be sold in 2014, due largely to the skepticism consumers have regarding Windows 8.

What’s a tablet maker to do?

The problem many tablet vendors have is that the products they sold last year to consumers — which may still be in channel — are largely still good enough. Without a compelling reason to upgrade, consumers are going to hang on to their existing devices. In addition if Xiaomi expands its market further into the developed world, consumers will flock to its high-functionality low-cost devices.

Vendors need to present to consumers compelling reasons to upgrade. If a new-generation of tablets is going to be shipped out with 4K screens and octa-core SoCs, an ecosystem needs to be developed around those devices to make upgrading worthwhile. Consumers have money to spend on these devices; the recession is long over. Vendors simply need to do a better job at making the case to upgrade.

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