Apple and Samsung herald latest UAE launches as rivalry cools

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• Apple launches iPhone 14 and Series 8 watch
• Samsung rolls out its global store revamp to the UAE

The global rollout of the Samsung retail store revamp will arrive in the UAE with much fanfare this week, within days of the next global Apple launch.

But the battle for smartphone dominion is not as heated as it once was, according to Gulf retailers.

Apple’s annual fall event – dubbed “Far Out” this year – will take place on Wednesday (September 7) and is expected to headline with the new iPhone 14 series, Apple Watch Series 8, upgrades, and a surprise wildcard.

Samsung Gulf Electronics on Tuesday unveiled its freshly renovated store in Dubai’s Deira City Centre as part of its global branding, display and user experience strategy.

• UAE tops ‘digital lifestyle’ rankings amid investment push

But while the arch tech rivals continue to compete on innovation, the local retail war is largely centred around replacement models.

“The ecosystems have got large enough and the replacement markets are massive,” Ashish Panjabi, chief operating officer at Jacky’s Retail LLC, a local Samsung partner, told AGBI. 

“Apple has got more than one billion iPhones out there. If you consider a phone has to be replaced every two to three years, they’re just playing to their replacement market. It’s the same thing with Android. 

“In terms of the number of new people moving onto their [respective] platforms, I don’t think that has bothered anyone as much as it would have once upon a time.”

Owning both an iOS and Android device has also become a common phenomenon and diluted the dual brand rivalry contest, Panjabi said.

Around 97.6 percent of people in the UAE use mobile phones and smartphones, according to 2021 figures from Statista.

The number of mobile cellular subscriptions per 100 inhabitants in UAE is 202.5, indicating that users own more than one device each on average.

“From a market share perspective, and from a value perspective, Apple in the UAE is extremely strong because the average selling price tends to be very high,” Panjabi said. 

“But from a units perspective it’s still an Android market in the UAE, and Samsung does dominate that market. Huawei and others are distant places.

“It’s essentially a market between two players – Samsung and Apple. But, keep in mind, in the UAE a lot of people carry both devices.”

The global work-from-home shift has also driven the two-phone phenomenon.

“Although you can have two SIM cards in a phone, a lot of people wanted to keep that separation between work and personal [devices],” Panjabi said.

“So, we do see a lot of people with two phones, and with Android and iOS. That also means the competition isn’t necessarily between Apple and Samsung, or Apple and Huawei. I think these days it’s more a case of staying within your ecosystem and maximising your share.”

Samsung led the Gulf Cooperation Council (GCC) smartphone market in terms of shipments in Q1 2022 with a 47.5 percent share, according to July data from IDC’s Worldwide Quarterly Mobile Phone Tracker.

The vendor posted 6.9 percent quarter-on-quarter (QoQ) growth in shipments as supply improved, especially for its S-series devices.

Second-placed Apple, with a 15.4 percent share, reported an 18.2 percent QoQ shipment decline with channel partners reporting supply constraints and delays in shipping. 

The GCC smartphone market was worth $2.09 billion in Q4 2021 – a decrease of 4.5 percent quarter-on-quarter (QoQ), but with smartphone shipments up 0.4 percent QoQ in Q1 2022 to 5.47 million units. 

Smartphone shipments were up 6.3 percent QoQ in Q4 2021 to 5.39 million units.

Apple’s annual event is traditionally subject to high speculation, and this year is no different.

The new iPhone 14 series is rumoured to sport a new design as well as a possible satellite option.

Some retailers expect sales to be subdued unless the iPhone maker brings marked changes to its September models.

“The rate at which people are updating their smartphones has slowed down,” a retailer, who declined to be named, said.

“There was a time we had orders for the latest iPhone model weeks before the launch. Now, people want to wait and see if the design and features are significantly different. Otherwise, they don’t feel the need to switch.”

A Deloitte report said the UAE and Saudi Arabia are mirroring the global trend with an increased holding time for phones between upgrades, driven by the increased cost of devices, commoditisation of attractive smartphone features, as well as the lack of “killer differentiating features” between smartphone generations.

According to an IDC report published in August, global shipments of smartphones are forecast to decline 6.5 percent to 1.27 billion units in 2022 due to record-breaking inflation, geopolitical tensions and other macroeconomic challenges that have significantly dampened consumer demand.

The latest forecast figures represent a reduction of three percentage points from previous projections. 

However, IDC expects the setback to be short-term and the market to rebound in 2023 with 5.2 percent growth year-over-year and, in the long-term, a five-year compound annual growth rate of 1.4 percent.

IDC said the GCC smartphone market is also forecast to decline 4.8 percent QoQ in Q2 2022 due to rising inflation, declining consumer demand and growing inventory in the channel. 

Jacky’s Retail LLC’s Panjabi does not see market conditions significantly muting sales in the UAE.

“It’s a question of playing to the replacement markets more than anything at this stage,” he said.