• Indonesia’s smartphone shipments fell 1% YoY in H2 2023 compared with a 10% decline in H1 2023.
• High-end ($400-$600) and premium (>$600) segments rose 13% and 11%, respectively, in H2 2023.
• Xiaomi increased by 2% YoY driven by strong growth in H2 2023.
• Transsion continued to strengthen in 2023, increasing by 34% YoY.
• 5G smartphone shipments grew 10% YoY in 2023.

Jakarta, London, San Diego, New Delhi, Beijing, Buenos Aires, Seoul, Hong Kong – February 27, 2024

Indonesia’s smartphone shipments decreased 6% YoY in full-year 2023, according to Counterpoint's Monthly Indonesia Smartphone Tracker. This was a smaller decline than the 10% fall in H1 2023 as smartphone OEMs seized more opportunities during the festive shopping season in H2 2023. During the period, there was an increase in demand for smartphones due to price promotion/bundling programs, offline retail coverage expansion and new launches featuring improved specifications and the latest technology to replace older models.

Source: Counterpoint Monthly Indonesia Tracker, 2023

The high-end ($400-$600) segment grew 13% in H2 2023 helped by the launch of the OPPO Reno10 series, which was introduced to replace the Reno8 T. Other OEMs also kept pace with their smartphone launches, including the Xiaomi 13T, vivo V29 and realme 11 Pro Plus. The premium (>$600) segment grew 11% partly due to the new launch of the Apple iPhone 15, Samsung Galaxy Z Flip5/Fold5 series and OPPO Reno10 Pro Plus.

Overall, Xiaomi grew 2% in 2023 largely driven by a 22% YoY rise in its entry-level (<$200) segment in H2 2023. Xiaomi carried out intensive online channel promotions at its Mi store and e-commerce partners in Q3 and Q4 2023.

Transsion Group’s market share grew 34% YoY in 2023 to reach 14% in 2023. Although Infinix still held a bigger share of the group, TECNO and itel witnessed sharp growth. The Transsion brands’ competitiveness was focused on improved specifications at affordable prices. Transsion Group's partnership with game developer Garena International, best known for its mobile game FreeFire, played a vital role in boosting brand attractiveness.

Although e-commerce platforms like Shopee, Tokopedia, Blibli, and Akulaku were the most accessible channels for online smartphone purchases, offline stores expanded. In 2023, smartphone OEMs expanded their offline retail coverage by opening their official stores in more shopping malls or semi-urban cities and partnering with multi-brand chain stores such as Erajaya. Consumers were attracted to official offline stores due to in-store services such as store atmosphere, support from brand promoters, various payment terms, store promotions and bundling programs.

5G smartphone shipments continued to increase, rising 10% YoY in 2023, with strong performances in the entry-level (<$200) and mid-range ($200-$400) segments. This was despite the slow adoption of 5G in consumer segments due to limitations on the frequency available. Instead, mobile operators continued improving their 4G and expanded their Fixed Mobile Convergence (FMC) services. Meanwhile, the regulator has been encouraging cellular operators to consolidate to achieve market efficiency and open opportunities to obtain sufficient frequency spectrum to deploy 5G technology. The latest initiative was the discourse on the merger of Smartfren and XL Axiata.

OEMs continued to improve smartphone specifications to compete in the market and provide a better user experience. Top chipset makers like MediaTek and Qualcomm grew the 5G chipset which accounted for 39% and 38%, respectively, in 2023. Also, OLED-type display technology grew 68% YoY in 2023 in entry-level (<$200) smartphones. OEMs were looking for partnerships with other technology OEMs to bring the latest technology to their smartphones, one of which is a partnership in improving sound quality. Dolby technologies for mobile such as Dolby Atmos and Dolby Vision grew significantly in 2023. Dolby's partnerships with several OEMs to enhance smartphone audio with Dolby Atmos are already available across smartphone segments. Likewise, the Dolby Vision feature, which provides improved imaging, was available on premium smartphones.

Outlook

Commenting on the market outlook, Senior Analyst Febriman Abdillah said, “Indonesia's macroeconomic situation could face high uncertainty in 2024 due to the state of domestic politics along with domestic and global economic tensions. If favorable political conditions prevail through 2024 along with stable macroeconomic growth, Indonesia’s smartphone market is expected to do well, assuming continued digital transformation and optimization of the 4G network in the wider area. We also hope to see continued improvements in smartphone specifications with the latest technology embedded in the upcoming smartphones.”

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

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