What happened: Shipments of mobile phones to China faces declined for the fourth consecutive month, falling 6% month-on-month in March, according to a report (in Chinese) by the China Academy of Information and Communications Technology (CAICT). Shipments dropped to 28.4 million units in March from 30.2 million units in March 2018. The number of new devices launched also fell 35% from a year earlier, with 52 new mobile phones hitting the market. Mobile phone shipments in 2018 fell 15.5% year-on-year in China, the world’s largest mobile phone market.
Why it’s important: In addition to the slowdown in economic growth, analysts also attribute the underperformance of the mobile phone market to a lull in feature innovation before widespread 5G network rollout. The domestic mobile phone market is nearly saturated and is waiting on next-generation wireless technology to bring new profit margins. A report by Counterpoint Research said 5G smartphone shipments are expected to grow 255% by 2021, almost reaching 110 million units. The report indicated growth would be slow during the initial commercialization phase in 2019, but an uptick in sales would appear once 5G infrastructures were ready.