Smartphone design is not always done by the brands you see on the box. A new report by Counterpoint Research sheds light on the extent of outsourcing in the industry, revealing which manufacturers rely most heavily on external design firms.
Motorola takes the crown for outsourcing, with a whopping 90% of its smartphones designed by third parties in the first half of 2024. Following closely is Xiaomi, with 78% of its designs outsourced. Vivo falls somewhere in the middle at 52%.
This trend is expected to continue, with Counterpoint predicting a 6% growth in the market for outsourced smartphone designs in the first half of 2024. The driving force behind this growth? The surging popularity of budget and mid-range phones from Chinese brands.
Looking at other major players, Huawei outsources around 44% of its designs, while Honor and the Oppo group come in at 40% and 39% respectively. Interestingly, the report reveals a distinct approach between Apple and Samsung.
Apple remain the sole outlier
Apple remains firmly committed to in-house design, controlling the entire process for all its iPhones. Samsung, on the other hand, outsources a smaller portion – 22% in the first half of 2024. This number, however, is reportedly on the decline.
Counterpoint attributes this shift to two key factors. Firstly, Samsung has faced declining market share in the lower and mid-range segments, areas where outsourcing is more prevalent. Secondly, the South Korean giant is increasingly relying on its own factories in India to manufacture budget devices.
Looking forward, Counterpoint predicts a 6% growth in the outsourced smartphone design market for the first half of 2024. The growth is said to be drive by the rising popularity of budget and mid-range devices from Chinese brands, which often rely on external design partners to expedite product launches and remain cost-competitive.
(Source)
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