Thailand's smartphone market is projected to grow 3% in 2024, driven by replacement purchases and advanced technology features, according to a global research firm.
In 2023, the smartphone market inched up 2% year-on-year, while other Southeast Asian markets declined, indicating Thailand was the only nation to see a marginal growth in a tough market last year, thanks to the strong performance of the budget smartphone segment, according to Counterpoint Research's Southeast Asia Monthly Smartphone Tracker report.
"The growth of smartphone shipments in 2024 may be up to 3% year-on-year, driven by the increased demand to renew smartphones, with 5G and the latest technologies embedded in the newer smartphones. Furthermore, the government's commitment to accelerating digital transformation will help drive the need to have a more reliable phone due to increasingly digital lifestyles," Febriman Abdillah, senior analyst at Counterpoint Research, told the Bangkok Post.
The research house expects to see continued growth in the lower price segment as more smartphones in this segment are improved in terms of specifications such as bigger storage and battery capacity.
Consumers may opt to upgrade their smartphones to keep up with the latest technology such as artificial intelligence (AI), new camera systems and new designs. Growth of the high-end and premium segment can be expected when the latest technology is implemented.
The 5G network continues expanding its coverage and the telecom regulator's initiative to roll out another new spectrum marked increased demand for high data speed in the country. Mobile operators continue to encourage customers to switch to 5G as more 5G smartphones become available at lower prices.
Thailand's economy is expected to grow well in 2024 even though the GDP projection is lower than in 2023.
The growth stems from increased domestic consumption and private investment as well as rising foreign tourist arrivals and expanding exports. The government also plans to provide a stimulus in the form of a digital wallet to encourage the digital economy and tax incentives to push consumption.
However, potential global and regional economic headwinds could impact inflation due to Thailand's dependence on energy imports.
Glen Cardoza, senior analyst at Counterpoint, noted that Thailand's smartphone market expanded 2% year-on-year in 2023 due to improved consumer sentiment towards year-end. The budget smartphone segment priced lower than US$200 grew by 17% year-on-year in 2023, while all other price ranges showed a decline, he said.
The budget segment showed remarkable improvement in the Thai market and the bleak overall economic situation was a driving factor. Political uncertainty surrounding the formation of a new government and a consistently subdued economy discouraged consumers from spending big.
However, this changed as the labour market began showing signs of recovery and average wages increased, giving consumers a respite. This, in turn, contributed to increasing demand for smartphones, especially among price-conscious consumers, he said.
Samsung led the smartphone market with a 21% share. However, its shipments declined by 4% year-on-year in 2023.
The brand's focus on mid- to high-end smartphones cost them some share in the budget segment. Chinese players like Xiaomi, Oppo, Vivo and Realme have all seen single-digit growth due to their focus on the promising budget segment priced lower than $200.
However, Apple enjoyed the biggest growth in volume, rising 26% year-on-year, despite belonging to the premium category.
Operators saw strong demand for iPhones throughout the year with the volume rising further following the launch of the 15 series.
Smartphones across price ranges fared differently as well. Compared to other countries in the region, Thailand has been more receptive to 5G smartphones in the budget segment.
"The 5G share was affected due to lower shipments of mid- to high-end smartphones but 5G smartphones witnessed a 139% increase in the below $200 segment in 2023," said Mr Cardoza.
"This jump can be attributed to the ease with which consumers can get 5G and affordable prepaid and postpaid 5G plans. Operators are also seeing an uptick in trade-ins and package deals, especially for iPhones. The iPhone 14 and 15 series sold well through operators like Advanced Info Service and True Corporation in 2023."
Mr Cardoza added that as the economy further improves, consumers across price tiers will look to upgrade and 5G smartphone shipments will increase further. The below-$200 segment will be the key here as these smartphones will sell more than any other segment.