Portuguese Smartphone Sales Increase 27 Percent in Q1 2015

According to the GfK Temax index, in Q1 2015 sales revenue in the Portuguese technology products sector grew to €195 million (US $213 million) from €142 million (US $155 million) the previous year. The telecommunications market registered an increase of 37 percent on the index when compared to the same period in 2014. Additionally, revenue from smartphone sales increased by 27 percent. However, smartphones with a screen size between 5.5 and 6.9 inches showed a seven percent drop in sales over the past year. Tablets also saw a 30 percent decrease in revenue in Q1 2015, and the market share held by phablets fell from seven percent to five percent.

With one of the highest mobile penetration rates in the world (127 percent), Portugal has a ratio of more than one mobile phone subscription per person. The increase of 27 percent in sales of smartphones indicates that customers may be transitioning from less advanced mobile phones to smartphones. The country’s major operators, such as Vodafone and MEO, provide similar coverage, capacity, and services in the moderately competitive Portuguese market. Larger-screened phones, such as the iPhone 6, which costs €680.00 (US $759.00), and the iPhone 6 plus, which costs €780.00 (US $871.00), are among the most expensive mobile devices available but are priced around the same by each operator. Where offered, older phones with smaller screens like the iPhone 4S are less than a third of the cost of the iPhone 6 Plus and therefore are preferred by customers.

According to a recent report, Portuguese customers remain loyal to their current service providers, as evidenced by low churn rates. As a way to attract new customers, operators should create bundles that include the types of devices that customers are willing to buy. It remains to be seen if Portuguese MNOs can combat the current trend and incentivize their customers to buy larger phones by means of appealing offers, but currently the indication is conservative on behalf of the consumers.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. Contact Tarifica for a subscription to the Tarifica Alert. 
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