Worldwide smartphone shipments are predicted to drop to the single digits by 2017, according to the International Data Corporation (IDC), which says that, for North America and Europe specifically, that day could come as soon as this year.
"In North America we see more than 200 million smartphones in active use, not to mention the number of feature phones still being used," Ryan Reith, program director with IDC's Worldwide Quarterly Mobile Phone Tracker, said in a statement.
2014 will be a year of change, Reith notes, not only because it will see the largest decline in market growth yet, but because the reasons behind smartphone adoption are shifting.
"New markets for growth bring different rules to play by and 'premium' will not be a major factor in the regions driving overall market growth," he said.
The IDC said market saturation will likely force service providers and phone makers to cut prices in order keep profits afloat. The average price for a smartphone sold globally in 2013 was $335 - a number they expect to dive to $260 within five years.
"In order to reach the untapped demand within emerging markets, carriers and OEMs will need to work together to bring prices down," said Ramon Llamas, research manager with IDC's Mobile Phone team. "Last year we saw a total of 322.5 million smartphone units ship for under $150 and that number will continue to grow going forward."
As evidence, Llamas points to "numerous" announcements this year already of devices in this price range, with some going for as little as $25.
"Just as the dynamics have changed for overall smartphone growth, so have the dynamics for smartphone pricing in the markets where continued growth is expected," he said. "Not all vendors will want to get into this space, but those that do must make deliberate choices about their strategies in order to succeed."
The slowing market will not change the competition between iOS and Android, with Google continuing to provide variety and affordable prices while Apple focuses on manufacturing high-priced, high-end devices, the IDC says. Meanwhile, Windows Phone is the fastest growing of three thanks to help from partners like Nokia.
In regards to BlackBerry, the IDC says the company will face tight rivalry in the enterprise market, predicting that its high-priced products could suffer.
