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Telecommunications market stagnation.  Artificial Intelligence and Virtual Reality are the solution – Marketeer

Telecommunications market stagnation. Artificial Intelligence and Virtual Reality are the solution – Marketeer

The telecommunications market is facing a period of recession, after the record sales it witnessed during the epidemic. For GfK experts, it will only be possible to interrupt this period with news that encourages consumer demand, highlighting two trends in the smartphone and gaming industry: generative artificial intelligence and augmented/virtual reality.

In an analysis of different regions of the world, the year was characterized by very different developments compared to 2022. Central and Eastern Europe was the region with the highest revenues (+3.9%), followed by Western Europe (2%). Revenues in the Middle East, Africa and China regions also improved, with increases of 1.1% and 0.3%, respectively. Only two regions of the world saw revenue declines: Emerging Asia (excluding China) by 5.9%, and Latin America by 3.7%.

Globally, the average price of smartphones rose slightly again (+$34), reaching $389. This increase is a result of the constant demand for premium devices with better features. In 2023, 5G models represented 81% of revenue, up 6 percentage points compared to 2022, with shares of devices with more than 512GB of storage and fast wireless charging also rising by 9% and 5%, respectively.

Artificial intelligence is the next step

Currently, smartphone use is largely focused on messaging apps (72% of users worldwide), such as WhatsApp or WeChat, or photography (64%). However, the continuous improvement of device performance predicts that the next step will be the widespread application of generative artificial intelligence.

GfK's analyzes of sales and long-term consumer behavior allow us to conclude that the moment generative AI enters the daily lives of smartphone users, there will be an increase in demand, as consumers are willing to pay more for greater technological advances.

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In 2023, consumer enthusiasm for the Metaverse device also declined worldwide, which was reflected in total unit sales. However, revenues bucked this trend and recorded an increase of 15%, justified by the fact that interested consumers invested in more advanced augmented reality, mixed reality or virtual reality products, with a tendency towards an increase in their value.

An example of this is augmented and mixed reality glasses, which grew by 30% and reached a value of $225 million in 2023, compared to a growth of only 4% recorded in 2022.