Smartphones are SO 2015

It had to happen. Sooner or later. Eventually.

Well, it looks like we’re there.

It looks as thought we’re past “peak smartphone,” and approaching the point where we have device saturation. Cellphone connections surpassed the population globally sometime in 2016. Anything sold in the last few years will meet the definition of a “smart” phone. Even pretty dumb devices access the ‘net today. Virtually everyone that wants a smartphone and can afford one, has one. Or more.

The news that smartphone sales have dipped well below their 2015 peak should come as no surprise to anyone. The World still absorbed 1.167 BILLION smartphones in 2023, which is no small number, but it’s perhaps 20% off the 2015 peak.

There are a lot of reasons for that.

Successive upgrades are looking increasingly incremental. If you already have, say, an iPhone 12,  can you tell me why you’d like to have the iPhone 15?

Of course, you can’t. That’s why you still have your iPhone 12.

There are a number of factors at play here.

Firstly, your device is probably capable of running the latest version of software available for it. Apple’s iOS releases typically overwhelm the previous version within a month of release.

Market monitor telemetrydeck.com noted that in November 2023, two thirds of devices had been running iOS 16, but within a month, that 65% had switched-up to iOS17. The support for Apple’s legacy fleet is pretty robust too. If you can keep your device alive, chances are good that it’s supported. The fractured nature of the Android market makes analysis more complex, but let’s assume it’s similar.

Secondly, we breezed right past “peak functionality” some time back. Today’s latest models are only incrementally better than older devices. New OS? Faster processors? Really? My phone does just fine keeping up with me. Waiting for my phone to “catch up” isn’t something I spend time on. The cameras aren’t really that different at all, although better software is improving camera images literally beyond recognition — in some cases, across existing fleets.

The applications are all largely updated — but that’s all. That’s a problem that smartphone manufacturers will have to embrace — or avoid. Samsung is talking up the “AI” functionality of the S24, but that’s an application. If you really need to spend the money to remove the tropical background from your selfies, you’ve probably got other, bigger problems. Maybe it's time to check and see if that letter from HR is there yet.

Third, after 16 years living in our pockets, going where we go, doing what we do, smartphones have evolved with incredible durability. Their survival rate is incredible, given what’s inside one. The fragility and obsolescence that seemed practically built-in to early devices, has all-but been overcome. Today’s smartphone can handle all kinds of abuse, including being dropped – even into water. It’s not your phone that needs that extra margin of Titanium strength. War has proved Smartphones have survived events that humans haven’t.

Finally, the other problem that’s behind weaker demand is always going to be price. Trying to squeeze the premium out of the lemon every year hasn’t increased the size of the lemon, but it’s impacted on the juice. As prices climb, and in the absence of any functionally compelling reason to re-invest, people are naturally looking to sweat their devices a bit longer.

So what’s next? You can be sure an industry that’s proven capable of making a billion-and-a-half widgets a year is busy looking for the next “big thing.” Is that VR? Unlikely — but so was an iPhone in 2006.