Fewer tourists picking up latest phones here

This article is more than 12 months old

Decline due to simultaneous launches, but domestic demand may arrest slide

Singapore is losing its shine as a hot spot for tourists looking to pick up the latest smartphones.

It is a trend analysts expect to continue as flagship phone launches are now taking place across key Asian markets at the same time, making it less of a need for tourists to buy them here.

But there is hope for stronger domestic demand this year, following the ending of 2G services earlier in the year.

Last year, 3.4 million smartphones were shipped here, registering a 21 per cent decline from the preceding year. This is the sharpest decline ever, said market research firm IDC.

Lacklustre demand from tourists and traders is believed to be the key reason behind the plunge. It is despite Singapore drawing record tourist arrivals of 16.4 million and spending of $24.8 billion here last year.

Last year, consumers in key markets in Singapore, China, Japan, Taiwan and Hong Kong got the new Apple iPhone 7 at the same time.

It was a similar situation at last month's launch of the Samsung Galaxy Note8 and Apple iPhone 8 and will be repeated for the launch of iPhone X.

In 2014, consumers in China got the iPhone 6 about one month after those in Singapore, Hong Kong and Japan.

That year, smartphone shipment to Singapore hit a record high of 4.6 million units, according to IDC. Market observers said that a large proportion went to tourists and traders.


Meanwhile, domestic sales of these devices dipped for the first time in 2014, and they have since been falling as smartphone ownership maxes out, according to separate studies by research firm GfK.

The mobile penetration rate stands at 150 per cent, with everyone owning at least one phone in Singapore, according to data from the Info-communications Media Development Authority.

GfK's data shows that smartphone sales domestically peaked at 2.81 million units in 2013 and have been falling steadily to 2.3 million in 2014 and 2.1 million last year.

But during the first eight months of this year, consumers bought 1.4 million smartphones, 22 per cent more from the same period last year.

"This growth is mainly due to the ending of 2G services in April this year," said Mr Gerard Tan, GfK's senior director of technology retail tracking.

People are also opting for line-only plans - which are cheaper as they do not come with subsidised handsets - when their two-year telco contracts run out. As at June, about 30 per cent, or 381,000, of M1's post-paid subscribers were on line-only plans.

Line-only plans have been all the rage since July 2015, when M1 offered a 5GB mobile data plan for $30 a month - less than half of what a similar package from rivals cost then.

In March this year, Circles.Life, which leased network wholesale from M1, upped the ante with its generous 26GB line-only plan for $48 a month. Now, every telco is bundling more mobile data for less.

Property agent Mark Chew, 47, who switched to two line-only plans a year ago, has more than halved his phone bills.