Samsung, Xiaomi drive phablet growth, but Apple likely waits in the wings

The popularity of large screen smartphones, known as phablets, isn’t abating, and demand for the devices is expected to outstrip that for portable PCs, according to research firm IDC.

Phablet shipments are projected to reach 175 million units this year, five million more than portable PC shipments, the research firm said in a report on Wednesday.

Demand for phablets, which IDC defines as phones between 5.5-inch and less than 7-inch in screen size, will only continue to grow, IDC added.

In 2014 alone, phablet shipments will be up 209 percent from last year, and make up 14 percent of all smartphone shipments.

Samsung’s Galaxy Note 3 and smartphones from Chinese vendor Xiaomi have been the top selling phablets, IDC analyst Melissa Chau said. But Apple’s much-rumored large screen iPhone could help drive phablet demand ever further, she added.

Apple is expected to announce its next generation iPhone next week. Along with a 4.7-inch phone, the company is also preparing a 5.5-inch device, according to online rumors.

Chau added that while the U.S. is the second largest market for the product category, the top market is China, where there are over 20 different vendors selling phablet devices.

“Chinese vendors picked up on the trend quite quickly, and introduced models that are at half the price of Samsung’s Galaxy Note,” she said. Xiaomi’s Redmi Note, for example, is a 5.5-inch smartphone that goes for 999 yuan (US$163) when bought without carrier subsidies.

In other markets, including the U.S., there are fewer phablet models up for sale, and the devices tend to be pricey. “The Samsung Galaxy Note is even more expensive than its flagship phone,” Chau said.

Demand for phablets, however, could pick up in Western markets with the arrival of a larger screen iPhone, but it will depend on the product’s price, Chau added.

“If the price gap isn’t big (with the smaller iPhone), then there’s a lot of potential for sales,” she said.