More than 500 smartphone brands have disappeared over the past 6 years

At its peak in 2017, the global smartphone market was fiercely competitive with more than 700 brands. By 2023, the number of active smartphone manufacturers with confirmed sales volumes had dropped by two-thirds to almost 250, according to Counterpoint, an analytics company that tracks smartphone sales in more than 70 countries.

A growing user base, improved device quality, longer gadget replacement cycles, economic obstacles, supply chain bottlenecks, and major technology transitions, such as 4G to 5G, have gradually reduced the number of active brands over the years. Many local smartphone makers, such as Micromax in India and Symphony in Bangladesh, have lost significant share or even exited the market over the past five years.

The decline in the number of smartphone manufacturers is mainly driven by local brands, while the number of global companies remains stable. Local brands maintain sales only in the low-cost device niche in regions with fragmented markets, such as Asia Pacific, Latin America, and the Middle East and Africa.

In the fast-growing smartphone industry, small companies are unable to invest in research and development, manufacturing, and capacity building. In addition, most small brands simply do not have the resources for large-scale world premieres and major advertising and marketing events involving celebrities from the world of sports and movies.

Local producers were once able to benefit from the market transition from 2G to 3G/4G, thanks to the rapid development of mobile communications and almost frenzied demand, especially in Africa, Asia and Latin America. However, since then, the needs of the average mobile phone user have changed. The determining factor for consumers has become the popularity of the brand and the presence of a developed ecosystem.

The rapid growth and market expansion of Chinese manufacturers such as Xiaomi, OPPO, and Vivo have also brought the decline of small brands closer. Chinese companies have introduced a wide range of high-quality smartphones at aggressive prices, providing customers with the best value for money.

The COVID-19 pandemic, shortages of components, and the ongoing global economic downturn have exacerbated the problems in the smartphone market and hit relatively small local manufacturers first, while large global brands have found it much easier to maintain profitability in such market conditions.

In the future, the number of smartphone manufacturers will continue to decline as large global brands are better adapted to all macroeconomic disruptions and technological transitions. Large-scale investments by major brands in research, development, logistics and marketing have become key factors in the market consolidation trend.