China’s smartphone sales slide 10% year-on-year (but not for the reason you think)

Well this is interesting: even as China becomes increasingly mobile, it seems that smartphone sales in the country are on the downslope. According to new data from market research firm GfK, unit sales of Chinese smartphones were actually down 10 percent year-on-year in Q2. A year ago, 98.6 million units were sold in the second quarter. This year, only 88.7 million units were sold.

This data seems to reflect a decrease in consumer interest in China’s lower-end budget smartphones, because GfK reports that even though total unit sales were down, demand for high-end phones – handsets costing US$500 or more – has actually increased significantly (49 percent year-on-year). The high-end smartphone market is now 17 percent of the total smartphone market in China, up from 10 percent last year.

In other words: China’s consumers are buying fewer cheap smartphones, and instead more of them are saving up for less-frequent-but-more-expensive purchases of high end handsets.

China also saw strong growth in its 4G market, according to GfK – a claim that seems to be validated by other data from China.