Singapore is losing its shine as a hot spot for tourists looking to pick up the latest smartphones.
It is a trend analysts expect to continue as flagship phone launches are now taking place across key Asian markets at the same time, making it less of a need for tourists to buy them here.
But there is hope for stronger domestic demand this year following the ending of 2G services earlier in the year.
Last year, 3.4 million smartphones were shipped here, registering a 21 per cent decline from the preceding year. This is the sharpest decline ever, said market research firm IDC.
Lacklustre demand from tourists and traders is believed to be the key reason behind the plunge. This is despite Singapore drawing record tourist arrivals of 16.4 million and spending of $24.8 billion here last year.
IDC Asia-Pacific research manager Kiranjeet Kaur said that phone launches are now taking place across more Asian markets at the same time. "There is less of a need for tourists to come here to buy the latest smartphones these days," she said.
Last year, consumers in key markets in Singapore, China, Japan, Taiwan and Hong Kong received the new Apple iPhone 7 at the same time. It was a similar situation at last month's launch of the Samsung Galaxy Note 8 and Apple iPhone 8, and will be repeated for the launch of iPhone X.
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21%
Percentage decline in the number of smartphones shipped to Singapore last year, compared with the preceding year.
In 2014, consumers in China got the iPhone 6 about one month after those in Singapore, Hong Kong and Japan.
That year, smartphone shipments to Singapore hit a record high of 4.6 million units, according to IDC. Market observers said that a large proportion went to tourists and traders.
Meanwhile, domestic sales of these devices dipped for the first time in 2014, and they have since been falling as smartphone ownership maxes out, according to separate studies by research firm GfK, which tracks both online and physical retailers here.
The mobile penetration rate stands at 150 per cent, with everyone owning at least one phone in Singapore, according to data from the Info-communications Media Development Authority.
GfK's data shows that smartphone sales domestically peaked at 2.81 million units in 2013, and have been falling steadily to 2.3 million in 2014 and 2.1 million last year.
But during the first eight months of this year, consumers bought 1.4 million smartphones, 22 per cent more over the same period last year.
"This growth is mainly due to the ending of 2G services in April this year," said Mr Gerard Tan, GfK's senior director of technology retail tracking.
People are also opting for line-only plans - which are cheaper as they do not come with subsidised handsets - when their two-year telco contracts run out.
As at June this year, about 30 per cent or 381,000 of M1's post-paid subscribers were on line-only plans. Singtel and StarHub do not provide such a breakdown.
Line-only plans have been all the rage since July 2015 when M1 offered a 5GB mobile data plan for $30 a month - less than half of what a similar package offered by rivals cost then.
In March this year, one-year-old Circles.Life, which leased network wholesale from M1, upped the ante with its generous 26GB line-only plan for just $48 a month. Now, every telco is bundling more mobile data for less.
Property agent Mark Chew, 47, who switched to two line-only plans a year ago, said he has more than halved his phone bills since.
"I get more value for money buying the phones separately," he said.
