The Smartphone Revolution

From Novelty to Necessity: The Smartphone Journey

In 2012, we witnessed a pivotal moment in technology history. For the first time ever, smartphone sales surpassed traditional computer sales, marking the beginning of a mobile-first world. Back then, there were 835 million smartphone users worldwide, and the shift to mobile browsing was only just beginning. Fast forward to 2025, and the transformation has been extraordinary.

Today, the global smartphone landscape looks dramatically different. With over 5.8 billion smartphone users worldwide and a penetration rate of approximately 80%, smartphones have evolved from a “fun but unnecessary toy” into an essential lifeline connecting us to virtually every aspect of modern life.

Here in New Zealand, the transformation has been equally impressive. With 5.03 million internet users and a 96.2% online penetration rate at the start of 2025, Kiwis are among the most connected people on Earth. Nearly all mobile connections in New Zealand (99.9%) are now broadband-capable, connecting via 3G, 4G, or 5G networks.

The Numbers Tell a Compelling Story

The growth trajectory has been impressive. The global smartphone market reached 1.22 billion units shipped in 2024, representing a 7% year-over-year increase after bouncing back from pandemic-related declines. The market is projected to generate US$485 billion in revenue in 2025, with China leading the way at US$111.9 billion.

New Zealand’s smartphone market tells a similar story of maturation and growth. The market is projected to generate NZ$1.08 billion in revenue in 2025, with Kiwis spending an average of NZ$206 per person on smartphones. The market is expected to reach 1.65 million units by 2030, reflecting steady growth despite economic headwinds.

What’s particularly noteworthy is how the market has matured. In 2012, we were celebrating the early adoption of smartphones. Today, mobile devices account for 71% of all internet traffic globally, and in markets like India, that figure reaches an astounding 91%. The smartphone has definitively become the world’s primary gateway to the internet, eclipsing desktop computers entirely.

Quick Stats:

• Global: 5.8 billion smartphone users worldwide (up from 835 million in 2012)
• Global: 80% smartphone penetration rate
• Global: 1.22 billion units shipped in 2024 (7% growth)
• Global: 71% of internet traffic from mobile devices
• NZ: 5.03 million internet users (96.2% penetration)
• NZ: 99.9% of mobile connections are broadband-capable
• NZ: NZ$1.08 billion market revenue projected for 2025

The Rise of the Premium Device

The smartphone market has undergone significant premiumisation. The global average selling price has climbed to US$426 in 2025, reflecting consumers’ willingness to invest in more powerful, feature-rich devices. In the United States, that figure jumps to US$657, while emerging markets like Africa maintain lower averages at US$179, ensuring smartphones remain accessible to diverse economic segments.

New Zealand sits firmly in the premium category. Average selling prices in New Zealand reached NZ$1,022 in late 2023, with a year-over-year increase of 16%. The premium segment (devices priced NZ$1,670+) has seen remarkable growth, rising from 18% of the market in Q4 2022 to 28% in Q4 2023. This surge was largely driven by strong demand for Apple’s iPhone 15 Pro range.

This price stratification has created an interesting market dynamic. Globally, the mid-range segment (devices priced between US$250-$500) accounts for approximately 47% of shipments. In New Zealand, the mid-range segment (NZ$167-$668) represented 42% of shipments in late 2023, with the Samsung Galaxy A series proving particularly popular among Kiwi consumers seeking premium features without flagship prices.

Quick Stats:

• Global: US$426 average selling price
• NZ: NZ$1,022 average selling price (16% YoY increase)
• NZ: Premium segment (NZ$1,670+) grew from 18% to 28% of market
• NZ: Mid-range devices (NZ$167-$668) account for 42% of shipments
• Global: Mid-range segment accounts for 47% of shipments

Today’s Technology Leaders

The competitive landscape has shifted considerably from the early days. While Apple and Samsung continue to lead globally with approximately 18% market share each, Chinese manufacturers have surged. Xiaomi, OPPO, Vivo, Honour, and Transsion have collectively captured 56% of global smartphone shipments, driven by aggressive expansion into emerging markets and a focus on value-driven innovation.

New Zealand’s market dynamics tell a different story. Apple and Samsung dominate the local market, together accounting for approximately 80% of smartphone sales in 2023. Apple holds the largest share at around 46%, with Samsung close behind at 35%. This duopoly has remained remarkably stable over the past decade, though Chinese manufacturer OPPO has been making inroads, securing third place with approximately 10% market share.

In terms of operating systems, Android maintains a slight edge globally and in New Zealand, holding approximately 53% of the market, with iOS capturing the remaining 47%. The three major mobile service providers in New Zealand (Spark, Vodafone, and 2degrees) all now offer 5G wireless broadband, though coverage varies between urban and rural areas.

The “super app” phenomenon we glimpsed in 2012 has matured beyond recognition. In 2024 alone, users downloaded 142 billion apps globally, with gaming representing 34% of downloads. Apps that took months to reach a million users in 2012 are now eclipsed by applications gaining millions of users in days.

Quick Stats:

• Global: Apple and Samsung each hold 18% market share
• Global: Chinese manufacturers hold 56% combined market share
• NZ: Apple and Samsung together hold 80% market share
• NZ: Apple leads at 46%, Samsung at 35%, OPPO at 10%
• NZ: Android 53%, iOS 47% of operating system market
• Global: 142 billion app downloads in 2024

The Current Wave: AI and 5G Revolution

Two technologies are reshaping the smartphone experience in 2025: artificial intelligence and 5G connectivity.

5G Dominance: 5G smartphones now represent 68% of all devices in active use globally. In the United States, 83% of new smartphone sales are 5G-enabled models. Average mobile download speeds have surpassed 220 Mbps, enabling 4K video streaming and cloud gaming directly on mobile devices.

In New Zealand, all three major carriers (Spark, Vodafone, and 2degrees) launched 5G services, though coverage remains more comprehensive in urban centres than in rural areas. With 99.9% of mobile connections now broadband-capable, Kiwis are well-positioned to take advantage of faster speeds and lower latency as 5G infrastructure continues to expand.

AI Integration: Artificial intelligence has moved from a novelty feature to the core of the smartphone experience. Over 46% of new models feature AI-enhanced cameras, and manufacturers are racing to integrate on-device AI assistants that offer personalised services, smart photography, and real-time language translation. The emphasis has shifted from raw processing power to intelligent, context-aware computing.

Quick Stats:

• Global: 68% of smartphones are 5G-enabled
• Global: 83% of new US smartphone sales are 5G models
• Global: 220 Mbps average mobile download speeds
• Global: 46% of new models feature AI-enhanced cameras
• NZ: All major carriers offer 5G (varying coverage)
• NZ: 99.9% of connections are broadband-capable

Environmental Consciousness

A trend barely visible in 2012 is now mainstream: sustainable design. Modern consumers increasingly prioritise environmentally-friendly devices, and manufacturers are responding. The refurbished smartphone market has grown significantly, with average prices around US$259, reflecting demand for sustainable technology choices. Companies are focusing on longer device lifespans, recyclable materials, and more efficient manufacturing processes.

Consumer behaviour reflects this shift towards sustainability. The average replacement cycle has extended to approximately 31 months globally and continues lengthening. In New Zealand, economic factors including the ongoing cost-of-living crisis have also contributed to consumers holding onto their devices longer, with many opting for mid-range devices that offer strong value propositions.

Quick Stats:

• Global: US$259 average price for refurbished smartphones
• Global: 31 months average replacement cycle (extending)
• NZ: Economic factors driving longer device ownership
• Growing demand for sustainable, recyclable materials

Looking Ahead: The Next Frontier

As we project into the late 2020s and early 2030s, several transformative trends are emerging that will redefine what we consider a “smartphone.”

The Convergence with AR/VR

One major shift on the horizon is the integration of augmented reality into everyday mobile experiences. The AR/VR market, valued at approximately US$60 billion in 2024, is projected to reach US$200 billion by 2030, growing at 22% annually.

Within 5-10 years, industry experts predict AR glasses will evolve into sleek, lightweight frames with capabilities surpassing today’s smartphones. Companies like Meta, Apple, Google, and Samsung are investing heavily in this space. Meta’s partnership with Ray-Ban extending to 2030 signals a belief that AR smart glasses will become as ubiquitous as smartphones are today.

WebAR technology is making augmented reality instantly accessible through smartphone browsers, eliminating the need for dedicated apps. Imagine pointing your phone at furniture in a store and instantly seeing how it would look in your living room, or translating foreign language signs in real-time through your camera lens. These experiences are already emerging and will become standard by 2030.

Quick Stats:

• US$60 billion AR/VR market value in 2024
• US$200 billion projected by 2030
• 22% annual growth rate
• Meta-Ray-Ban partnership extended to 2030

Beyond the Screen

The smartphone as we know it may evolve beyond the traditional rectangular touchscreen. Foldable smartphones saw 62% growth in shipments in 2024, exceeding 20 million units despite their premium pricing. While still a niche segment, foldable technology demonstrates consumers’ appetite for new form factors.

In New Zealand, foldable devices like Samsung’s Galaxy Z5 Series and OPPO’s Find N3 Fold have gained traction across major telcos and retail channels, with both performing well in the premium segment. This signals Kiwi consumers’ openness to innovative form factors when the value proposition is clear.

More radically, the concept of smart glasses with holographic displays could eventually replace traditional smartphones. Industry forecasts suggest that by the 2030s, AR glasses may pack more computational power than today’s smartphones while projecting information directly into our field of vision.

Quick Stats:

• 62% growth in foldable smartphone shipments in 2024
• 20+ million foldable units shipped globally in 2024
• Growing adoption of foldables in NZ market
• AR glasses predicted to surpass smartphone capabilities by 2030s

AI Becomes the Interface

Future smartphones will likely centre less on apps and more on intelligent agents. Rather than opening individual applications, users will interact with AI assistants that understand context, anticipate needs, and seamlessly coordinate across services. Voice and gesture controls, powered by advanced AI, may reduce our reliance on touchscreens.

Machine learning models running directly on devices will enable unprecedented personalisation while maintaining privacy. Your smartphone will learn your routines, preferences, and needs, proactively offering assistance before you ask.

Health and Wellbeing Hub

Smartphones are evolving into comprehensive health monitoring devices. Advanced sensors can already track heart rate, blood oxygen, and activity levels. By 2030, smartphones and their companion devices may monitor a wider range of health metrics, from stress levels to early disease detection, positioning them as essential healthcare tools.

Sustainability Takes Centre Stage

Environmental considerations will increasingly drive smartphone design. Consumers expect devices with longer lifespans, user-replaceable components, and minimal environmental impact. The average replacement cycle has already extended to approximately 31 months and continues lengthening, but pressure is mounting to further extend device longevity and improve recyclability.

Challenges Ahead

The smartphone industry faces several headwinds, both globally and in New Zealand. Supply chain complexities continue to impact production, with chipset availability remaining a concern. Trade tensions and tariffs create uncertainty, particularly affecting devices manufactured in China and sold globally.

Market saturation in developed countries like New Zealand means growth increasingly depends on convincing existing users to upgrade. With smartphones already delivering powerful computing experiences, manufacturers must offer compelling reasons for consumers to invest in new devices, particularly challenging during periods of economic uncertainty.

In New Zealand specifically, the ongoing cost-of-living crisis and efforts by the Reserve Bank to combat inflation have made consumers more cautious with their spending. While the market showed signs of recovery in late 2023 and early 2024, demand remains subdued compared to pre-pandemic levels.

Privacy and security concerns are mounting as smartphones collect ever-more personal data. Balancing innovation with user privacy will be critical for maintaining consumer trust.

The Mobile-First Future for New Zealand Businesses

If the past 13 years taught us anything, it’s that smartphones evolve faster than we predict. In 2012, we couldn’t have imagined the seamless mobile payment systems, on-demand everything, and always-connected lifestyle we take for granted today.

As we look towards 2030 and beyond, the smartphone may transform so dramatically that we stop calling it a smartphone altogether. The core function (keeping us connected, informed, and empowered) will remain, but the form it takes may be unrecognisable from today’s devices.

For New Zealand businesses, the imperative remains clear: meet your customers where they are, and with 96.2% of Kiwis online and mobile devices dominating internet usage, that’s overwhelmingly on smartphones. Whether through responsive websites, innovative apps, or emerging AR experiences, the mobile-first approach isn’t just best practice, it’s business survival.

With Apple and Samsung commanding 80% of the New Zealand market and Kiwi consumers demonstrating a clear preference for premium devices, businesses must ensure their digital presence delivers the quality experience these sophisticated users expect. The data is unambiguous: mobile isn’t the future, it’s the present.

The smartphone revolution that began in earnest 13 years ago continues to accelerate, and we’re merely entering the next chapter.

Looking to ensure your digital presence is optimised for the mobile-first world? Contact us to discuss how we can help future-proof your online strategy.