- 1 Definition / Scope
- 2 Market Overview
- 3 Key Metrics
- 4 Market Risks
- 5 Top Market Opportunities
- 6 Market Drivers
- 7 Market Restraints
- 8 Industry Challenges
- 9 Technology Trends
- 10 Other Key Market Trends
- 11 Market Size and Forecast
- 12 Market Outlook
- 13 Distribution Chain Analysis
- 14 Strategic Conclusion
- 15 References
Definition / Scope
Hong Kong is one of the leading business hub in Asia Pacific region because of advanced telecommunications infrastructure In 2013, the industry is generation $74.7 billion from information and communication industry adding 3.7% of GDP. The government is able to execute Digital Strategy 2008 for making digital economy. According to the Global Information Technology Report 2015, Hong Kong holds the fourth position in Asia in the Network Readiness Index because of the advance position in the telecommunication infrastructure, business readiness and regulatory environment supporting the development of latest technology. Rapid economic development, increased affordability and competitive pricing has led to the mobile phones and tablets penetration in the country.
Data published by "eMarketer.com" shows that there will be 5 million users of smartphones by 2016 and the user base is going to increase to 5.4 million by 2019 while the penetration rate of smartphones would be 84% in 2016 and the trend is going to increase by 88.3%. Internet user user growth in Asia is going to be rapid due to widespread use of smartphones. Asia Pacific has achieved tremendous growth in the last 5 years and the analysts are predicting that there signs of the industry maturing in the next 5 years. By 2019, 49.8% of the population will own a smartphone.
|Base Year||2016||Researched through internet|
Penetration of smartphones and tablets has been 87% which is highest in the Asia Pacific region but maintaining the pace in the coming years is the biggest risk as the growth of the mobile users is limited. Only 5.4 million people will be using the smartphone by 2019 as compared to 5 million people in 2016 which is quite low from other countries in Asia Pacific like India and China. 69% of the population in Hong Kong owns single handset which again limits the usage of handsets and tablets. The ownership of single tablet is found by the people of the country.
Top Market Opportunities
- Ecommerce- Ecommerce companies has the huge potential for business development by marketing their products and reaching the end users over the smartphones and tablets.
- Internet- Increased use of smartphones and tablets have given opportunity for telecom companies for providing internet to the users.
- Mobile Application- Smartphones has opened opportunity for app companies to engage customers with the different applications for day-to-day life.
- Market Penetration- Entering the market for smartphones is highly conducive as the country is rich in IT infrastructure.
- Mobile Advertising- Advertising agencies has got the maximum opportunity to reach to the mobile clients for promotion and marketing activities of different companies.
- The government is supporting the development of IT Infrastructure and telecommunication industry.
- Users are opting for smartphones and tablets for accessibility.
- Brand value is also important among users of smartphone users.
- Data traffic is going to grow ten- fold by 2019.
- More capital expenditure by the mobile manufacturing companies leading to development of the industry and contribution to the GDP.
- Expansion of 4G technology to the internet users.
- Capital expenditure for telecommunication infrastructure for development of voice and internet.
- Market accessibility to countries like China for transfer of technology.
- Competitive pricing of the technology gadgets has led to availability of cheap devices to the users.
- 40% of the population in the age group of 15- 45 years which accounts the maximum contribution of gadget users, so the potential of smartphone users is going to be positive in the coming years.
The penetration rate of the smartphones is over 85% which is highest in the Asia Pacific region, due to which the opportunity of further expansion is quite limited in the coming years. Information security issues is one of the biggest challenge faced by the industry. Connection stability is one of the challenge for the smartphone. Lack of domestic smartphone manufacturers in the country because of price war from other competitors in the market. Over 5, 00,000 mobile phones and tablets are bought and sold outside the official distribution channels in the country. The growth rate of the user base is going to be below 5% in the country.
- IT security is one of the major challenge faced by the smartphone and tablet industry as the threat of data theft has increased all across the world.
- Availability of smartphones and tablets in the grey market is one of the major challenge faced by the industry as cheaper phones are available at the market, so the manufacturers are facing challenges of infringement mobile devices.
- The government is not taking action against the selling of cheap mobile phones in the grey market.
- Trading of large quantity of smartphones and tablets leads to artificial price fluctuation.
- The industry is going to reach to maturity stage in the coming years so the opportunity of massive growth is going to reduce.
- Innovation in the smartphones and tablets is dependent on the foreign companies due to which domestic players contribution is negligible.
- Apple IOS and Google Android are the two operating systems which are installed in the major smartphone and tablet and are dominating the Hong Kong market.
- Android is the dominating player in the industry.
- Touch screen technology is the top priority of the people of the country. 4G support smartphones are being made for high speed internet connectivity.
- Hybrid tablets are being marketed in the country for dual purpose usage.
- Hardware devices are getting improved in the tablet for voice as well as commercial usage.
- Water resistant and shock proof devices are built for smartphones and tablets to increase the life of the device from external shocks.
Other Key Market Trends
- 400 million advertisement requests by the companies to reach to the clients.
- 5 million unique users in the month.
- 49.1% of android is the highest mobile browser followed by Safari mobile browser with 27.4% share.
- 40.7% is dominated by DSL followed by China Mobile of 21.7%, Hutchinson 19.5% and Smartone of 17.8%.
- Wifi dominates the internet usage for the smartphone and tablet.
- 49.2% of the category used in the entertainment industry, followed by 15.4% by the videos.
- 79.3% of video downloaded by iPad is for TV series and movies.
- Remote accessibility apps are being developed for smartphones for training students and employees.
- IT security industry is increasing rapidly because of the concern of theft and the trend is going to be positive in the coming decades.
- Mobile banking is gaining momentum as more users are accessing smartphone device for purchasing over internet.
- Increase in the usage of 4G spectrum for the internet connection.
Market Size and Forecast
79.7% of the android users, 15.8% of iPhone users and 4.5% of the iPad users. 62.3% of phablet users followed by 10.6% of tablet growth in Hong Kong. In 2015, Hong Kong was able to sell 33 million of tablet. Q-o-Q, Samsung has been able to sell above 300 million smartphones in the country. The industry is $1.3 billion industry and the growth rate is going to be 2.5% in the coming years. The number of unique users of smartphones would be around 5.4 million by 2019 and the boom in the industry is going to decline in the coming years.
- Mobile applications is going to be one of the important sector which is going to boom in the coming future.
- The sales of the phablet is going to grow rapidly in the coming years with iPad in the luxury segment and Samsung phablets preferred as affordable gadget.
- The country is going to get demand from countries like China for smartphones and tablets.
- Fierce competition from the telecom companies for voice and internet as the number of players are less in the industry.
- Grey Market is going one of the important market for purchase of smartphones and tablets by the people.
Distribution Chain Analysis
Hong Kong market is divided into two parts based on the accessibility of the devices by the consumers. The one distribution channel is the authorized dealer of the brands and the other distribution channel is the grey market. Electronic devices are traded in the country and are send across different parts of the world. Reused phone and unlocked phone are sold in the market. The devices sold in the market are comparatively of the lower price. Ecommerce companies have come who are selling tablets and smartphones trading portals and website. Smaller retail shops are available across the regions for the distribution of phones.
Hong Kong is one of the prime destination of electronic devices in Asia Pacific and industry is going to one of the major contributions to the economic GDP. Innovation and brand penetration is going to be one of the key drivers for purchase of smartphones and tablets. IT Infrastructure and government support is going to drive the industry. The growth of this industry has opened up opportunity for other associated companies and the trend is going to continue in the coming years and Hon Kong is going to be one of the beneficiary.
http://www.vpon.com/images/datafile/Vpon_2014-Q3_HK.pdf http://www.emarketer.com/Article/Asia-Pacific-Boasts-More-Than-1-Billion-Smartphone-Users/1012984 http://www.statista.com/statistics/201250/forecast-of-mobile-phone-users-in-asia-pacific/ http://blog.mordorintelligence.com/wp-content/uploads/2015/11/growth-in-hong-kong-accessories-market.png http://img.cellular-news.com/story/43651/Smartphone_usage_set_to_dominate_Hong_Kong_mobile_market_2.jpg http://www.livemint.com/r/LiveMint/Period1/2013/09/20/Photos/g_Asia-mobile_web.jpg