Sydney, Australia, 27^th Feb 2017: Following six straight quarters of YoY decline, the Australian mobile phone market returned to growth as it shipped 2.93m mobile phones in 2016Q4 as compared to 2.84m same time the previous year representing a 3.2% YoY growth.

According to International Data Corporation’s (IDC) Quarterly Mobile Phone Tracker , 2.79m handsets shipped were smartphones whilst the remaining were feature phones in 2016Q4. The growth came primarily from smartphones as new players entered the market. A specific customer base still exists for feature phones as they hold their place even on the back of the announcements from telecom operators to shut down their 2G network across the country in 2017. Majority of the feature phones shipped into the country are hence 3G enabled devices.

Interestingly, iOS has again become the most popular operating system (OS) in Australia overtaking Android as it took over more than half (54.9%) of the total smartphone shipments in 2016Q4. “Despite new players such as Google with the Pixel device entering the market, Android could only take 44.6% market share. This goes to show the unanticipated success of iPhone 7 range as Apple smashed through shipment records for the quarter” says Bilal Javed, Market Analyst at IDC Australia. Windows Phone declines further and hold less than 1% market share as lack of new devices and apps on the platform continue to hinder any opportunity in both the consumer as well as commercial segment.

Apple surpassed all expectations as the newly launched iPhone 7 gained momentum in the market and stretched its lead further to hold 54.9% of the Australian smartphone market. “With over 1.5m shipments in 2016Q4 making it one of the most successful quarters for Apple in Australia since its launch” says Bilal. Apple was able to benefit as refresh cycles on 2 year post-paid contracts approached and consumers warranted a natural upgrade. It seems Apple was also able to pounce on the void left by Samsung Note 7 for consumers seeking large screen devices with a matching spec heavy iPhone 7 Plus device.

Even as it experienced a 28.8% YoY decline, Samsung was still able to hold onto their second spot as it held 15.6% of the market. “The impact of the recall and the negative publicity surrounding Note 7 is evident here and makes the 2017 flagship even more critical for Samsung as it looks to gain share amidst other Android vendors in Australia.” adds Bilal. While the negative publicity because of Note 7 fiasco hit, the Galaxy S series has carried Samsung in Australia with close to 80% of shipments coming from the flagship range.

Alcatel’s share grew from 6% in 2016Q3 to 6.9% in 2016Q4 as its stronghold in the low to mid-priced segment continued. Alcatel’s focus on a niche strategy, diversified product portfolio, along with its expanding channels allows it to maximise its customer reach. Huawei established itself in the quarter with 4.7% market share in 2016Q4 as it focused on mid-tier prepaid phones available through telecom operators; however with the recently launched Mate 9 as well as the flagship P series device expected in first half of 2017, Huawei will be looking to drive average selling price (ASP) higher and compete in the high-priced segment. The new kid on the block, Google with its impressive Pixel devices grabbed 4.6% of the market through its exclusive partnership with Telstra and JB Hi-Fi. The dark horse, OPPO who grew over 700% YoY to grab 2.9% market share will be the one to watch out for in 2017 as the battle amongst Android vendors heats up with HTC, LG and Motorola competing for share.

What remains to be seen is whether the multiple expected launches from Android vendors in the early half of 2017 and iOS later in the year will be able to inject further growth into a market that was showing signs of saturation.