HTC 2015 Annual Report Download - page 22

Business operations
Business operations
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Market Analysis
Emerging APAC and MEA are Growth
Powerhouses for Smartphones
The year-over-year growth of smartphone market has been slowing in the last couple of years.
Given the smartphone market is already saturated in developed markets, research firm Gartner
expectsmobilephonesaleswillincreaseonlyby2.5%andreach2billionunitsin2016,mainly
drivenbyrst-timesmartphonebuyersinemergingAPACcountriesaswellastheMiddleEast
&Africa(MEA).Meanwhile,thoughChinahasbeenthedrivingforceofthesmartphonemarket
in recent quarters, its slowing economy has negatively impacted worldwide growth; research
rmIDCsaidthatChinahasbecomeareplacementmarket.IDCalsopredictsthatphablet
(5.5”~6”)saleswillaccountfor71%oftotalshipmentsby2019.
Detachable Tablets Reach New High
Worldwidetabletshipmentscontinuedtodecline10.1%year-over-yearto206.8millionunitsin
2015,accordingtoIDC.Onethingworthnoting,though,isthetransitionfromtraditionalslate
tabletstodetachabletablets;whileslateunitsdropped21.1%year-over-year,thedetachable
morethandoubledandreachedarecordhighof8.1millionunits.Microsoft,GoogleandApple,
alloerdetachableproducts.7”~9”displaystilldominatedscreensize,followedby9”~13”.In
addition, Chinese players are rumored to be bringing dual operating systems (OSs) into the
detachable category. Research firm Digitimes forecasts global tablet shipments will remain flat
in2016,ataround200millionunits.
Cannibalization between Personal
Computing Devices
The rise of phablets and detachable tablets might signify a forming trend of emerging devices.
As the boundaries among notebooks, tablets and smartphones are blurred, we have seen most
ofthemajorhardwarevendorsexpandingtheirexistingproductlines.TraditionalPCmakers,
such as Lenovo and Asus, have been aggressively building their smartphone business in the last
offewquarters.HPInc.releasedaWindows10Mobile,EliteX3,atMWC2016.Sonyspino
Vaio, also confirmed it will launch a Windows 10 mobile. On the other hand, smartphone brands,
suchasSamsung,Xiaomi,Huawei,TCLandregionalplayers,suchasLavafromIndia,startedto
show interest in or returning into the traditional clamshell notebook, Chromebook and
detachabledevices.Gartnerpredictsworldwidecombinedshipmentsofdevices(PCs,tablets,
Ultramobilesandmobilephones)willreach2.4billionunitsin2016,a1.9%year-over-year
increasefrom2015.However,end-userspendingisexpectedtodecline0.5%forthersttime.
Inaneraofpersonalcomputingdevicesaturation,everydevicemakerunavoidablyhastoght
for every opportunity it can grab.
Exploring Opportunities in the Broader
Internet of Things
While the computing devices battles continue, and growth has been slowing and will
continue to slow in the foreseeable future, leading brands are now exploring and discovering
opportunities in wearables, virtual reality (VR), augmented reality (AR) and the broader
InternetofThings(IoT).Gartnerforecasts6.6billionIoTendpointswillbeshippedin2020,
with an installed base of 20.8 billion units.
Wearables started most prominently with the uptake of fitness and sleep tracking bands and the
accompanying trend that many refer to as the quantified-self movement. Early movers included
Fitbit,Jawbone,Mist,followedbyXiaomi,andmanyothersincludingGarminandHuawei.
ApplealsoreleasedAppleWatchinMarch,2015;thoughAppledoesnotdiscloseApplewatch
salesvolume,marketwatchersincludingIDCbelieveAppleWatchwaswell-received.According
toIDC’s3Q15report,Fitbit,AppleandXiaomiwerethetopthreevendorsinthewearable
category,withacombinedmarketshareof58.2%.Unlikeaforementionedbrands,whichsolely
focusononesinglewearableproduct,HTCusedadierentapproach;theUAHealthBox™,
launchedatCES2016,istherstconnectedwearablesolutionthatprovidesatotalsolutionfor
prosandamateurs.TheUAHealthBoxincludesawristband,ascaleandaheartratemonitor.
Onhead-mounteddisplay(HMD),Gartnerpredicts1.43millionunits,includingsmartglasses,
augmented reality glasses (AR), smart helmets, virtual reality goggles and other, will be shipped
in2016andtheHMDmarketwillbringcontinuedprogresstowardmainstreamadoptionfor
consumersandenterpriseuse.2016isanimportantmilestoneforvirtualreality.InJanuary,
Google said it had shipped 5 million units of Google Cardboard viewer, and 25 million cardboard
appsdownloadfromGooglePlay.Onthepremiumside,HTCVive™andOculusRiftstarted
shippingproductstoconsumers.SonyalsoconrmedthatPlayStationVR(previouslyknownas
ProjectMorpheus)willstartshippingin2016.InbetweencardboardandstationaryVR,there
is the Samsung Galaxy Gear VR. News also suggested that Google is working on a standalone
VR device that is similar to Samsung’s Gear VR. Although Apple has not yet released its own VR
device,itbroughtMattel’sviewmasterVRheadsetintoitsonlinestoreinDecember2015.