Audience members recording a performance with their smartphones during the 2014 CMT Music Awards in Nashville, Tennessee. Photo: Harrison McClary/Reuters

Britain’s ARM Holdings, which designs chips used in almost all smartphones, said annual growth in global smartphone shipments is likely to average 10 per cent through 2018, with most of that growth coming from low-priced handsets in emerging markets.

Over that time frame, annual growth will be 17 per cent for phones priced below $150, 14 per cent for those at $150 to $300, and just 4 per cent for handsets above $300 – a category that includes Apple Inc.’s iPhone – chief executive Simon Segars said at Taiwan’s Computex trade fair.

“These low-cost devices are going to have a big impact on the market,” Segars said. “There are smartphones out there now that sell for $20 to $25, which is phenomenal.”

About 90 per cent of all smartphones feature chips designed with ARM technology, so the trend towards lower handset prices led to ARM’s first-quarter profit growing less than in previous years.

Big impact on the market

To adjust to the changing landscape, ARM client Qualcomm Inc. plans to sell its first chips tailored to China, the world’s biggest smartphone market, where low-priced phones dominate.

Researcher IDC projects growth in worldwide smartphone shipments to reach 19.3 per cent this year and then slow to 6.2 per cent in 2018. That would follow last year’s 39.2 per cent when annual shipments topped one billion units for the first time.