BMI View: We have a bullish outlook for the Philippines consumer electronics market , forecasting growth of 5. 7 % in 2014 . This is in line with market growth in 2013 as rising incomes and declining device prices in the smartphone and tablet categories drive demand. Consumer electronics spending is likely to remain strong over the medium term , with government spending providing a stimulus supplementing technology trends such as demand for smartphones and tablets. Given the Philippines' low PC penetration, many provincial markets are relatively untapped territories, while rural populations contain the largest number of potential first-time mobile handset purchasers.
Headline Expenditure Projections
Computer Sales: USD2.1bn in 2013 to USD2.2bn in 2014, +6.9% in US dollar terms. Booming sales of Android tablets will be sufficient to offset the squeeze on notebook sales due to tablet cannibalisation.
AV Sales: USD848mn in 2013 to USD911mn in 2014, +7.4% in US dollar terms. The main driver of demand is flat-panel TV sets, where penetration is rising rapidly.
Handset Sales: USD2bn in 2013 to USD2.1bn in 2014, +3.9% in US dollar terms. Sales of smartphones are booming, particularly low-cost Android devices able to hit mass market price points, however intense price competition in the Android ecosystem is limiting increases in market value.
Key Trends & Developments
The increasing share of smartphones in the handset sales mix has driven increases in market value and average selling price in 2013, and we expect the trend to continue into 2014. Even after booming sales in 2012 and 2013, BMI believes the smartphone market has significant growth potential as incomes rise and competition continues to drive down device prices. We expect a continuation of the rapid expansion of the low-cost smartphone market in 2014, where competition between global leaders, Chinese branded vendors such as Huawei, ZTE and Lenovo, and local vendors such as MyPhone and Cherry...