Vietnam’s mobile phone market declined 18 per cent in the second quarter of 2012 – but it still registered double-digit growth of 10.9 per cent year-on-year, says IDC.

The slump has been blamed on consumer belt-tightening in light of inflation and economic malaise, which have impacted on the Vietnamese’ disposable incomes.

Feature phone shipments recorded a significant decline at 20.3 per cent while smartphone shipments fell 4.1 per cent reflecting the continued migration to smartphones amongst Vietnamese consumers.

“Migration from feature phones to smartphones has been very aggressive in Vietnam,” says Võ Lê Tâm Thanh, senior market analyst for client devices research at IDC Vietnam.

“As local and Chinese vendors struggle to retain market share in the saturated feature phone space which Nokia dominates, they are now turning to the entry-level smartphone segment where consumers have been quick to take advantage of declining smartphone prices,” Thanh added.

While economic uncertainties have dampened enthusiasm, the smartphone market is expected to bounce back strongly in the second half of the year as local vendors introduce more affordable smartphones and carriers reduce prices of 3G data plans, says Thanh.

Nokia accounted for more than half of all mobile phone shipments in Vietnam, boosted by the popularity of its dual-SIM and low-cost phones while Samsung continued to lead the country’s smartphone market.

GB