28 Mar 2022

Propped by Government Subsidies, Malaysia's Smartphone Market Grew by 10.6% in 2021; IDC Expects Flat Growth in 2022

KUALA LUMPUR, March 28, 2022 - Malaysia's smartphone market closed 2021 with over 12 million units according to the latest International Data Corporation’s (IDC) Quarterly Mobile Phone Tracker. Aggressive shipments in 2021H1 fueled this growth despite a decline for both supply and demand in the second half of the year.

"A government subsidy program plus relatively uninterrupted logistics compared to neighboring ASEAN markets drove Malaysia's market in 2021H1," says Ahmed M. Ahmed, Market Analyst for Malaysia Mobile Devices.

A subsidy program was rolled out to provide the Bottom 40 economic group (B40) with affordable access to smartphones through telco operators. Qualified individuals were able to receive a smartphone bundled with a data plan to stay connected during lockdown periods. Ahmed adds, "Top vendors used this opportunity to partner with operators and expand through this channel. This includes vendors that are not considered a strong player in the telco space, like Xiaomi."

Both Samsung and Xiaomi cemented their dominance in Malaysia's market. The combined shipments of both brands accounted for nearly 50% of all smartphones in 2021. "Honor's reentry in late 2021 received a muted response. However, the gap left by Huawei in the high-end Android market can be shaken by a familiar brand," says Ahmed.

IDC is forecasting a flat growth for smartphones in 2022. In a step toward post-pandemic recovery, the government is encouraging consumers to increase spending on other products and sectors. A new tax rebate is aimed to entice consumers to buy new energy-efficient home appliances. Also, another tax rebate is focused to promote local tourism during 2022. We will see consumer demand for smartphones drop as spending on entertainment and elsewhere take priority.

Despite over 28% of smartphones shipped in 2021 being 5G capable, 5G is still not offered by the major players in the country. Malaysia is lagging other countries in Southeast Asia. After the initial hesitancy, the top operators have welcomed the latest cabinet decision to relinquish 70% of its stake in Digital Nasional Berhad. This shareholding agreement will kickstart the commercial rollout of 5G. Going forward, 5G will be a strong driver for consumer upgrades, with projections for nearly 50% of shipments in 2023, up from 36% in 2022. The looming merger between Digi and Celcom is set to make the new entity the largest telco operator in the country. "Enticing consumers to stay with attractive 5G plans and bundles will be a high priority for Maxis and other telcos to remain competitive in the market," added Ahmed.

To know more about the IDC’s Worldwide Quarterly Mobile Phone Tracker, please contact Ahmed M. Ahmed at amahmed@idc.com. For media inquiries, please contact Fenny Tjandradinata ftjandradinata@idc.com  or Jane Yap at jqyap@idc.com.


About IDC Trackers

IDC Tracker  products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and online query tools. 

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,200 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDCASEAN   and LinkedIn. Subscribe to the IDC Blog   for industry news and insights.


Regions Covered


Topics Covered

Feature phone, Smartphone

For more information, contact:

Ahmed M. Ahmed (amahmed)

Jane Jia Qi Yap (jqyap)

Fenny Tjandradinata (ftjandradinata)