Qualcomm met the earnings estimates and beat the revenue estimates for its March quarter – but its projections for 3G and 4G device shipments continue shifting in fascinating ways. Qualcomm now estimates that North American 3G/4G device sales actually declined in 2012, slipping to 199 Million units in 2012 from 200 Million units in 2011. Qualcomm is also revising its year 2013 North American device sales downwards; to 215 Million from 220 Million it previously expected. This is a pretty extraordinary development. It implies that despite the widening availabity of LTE-equipped smartphones and tablets, the North American demand is remarkably tepid. This could well have something to do with Apple ‘s growth problems in its home market; Apple’s growth in Americas slipped below 10% in the most recent quarter. One reason for disappointing North American device volumes is the US consumer preference for WiFi-only tablets. The mobile industry once dreamed about consumers flocking to tablets with LTE support. That has not happened yet.
What this means for the smartphone industry is that Asia’s role in the smartphone market continues growing strongly – at the expense of North America. Qualcomm revised the China/India device volume estimate for 2013 notably, up 13 Million to 256 Million units. As recently as in 2011, North American market was still clearly ahead of China/India, by 200 Million vs. 165 Million units.
But now Qualcomm is projecting that in 2013, China/India 3G device shipments will outpace North America by a huge margin; 256 Million vs. 215 Million units. Asian smartphones are cheaper on average than models sold in North America, partly due to the enormous subsidies employed by US operators. As the focus of the global smartphone market shifts from