Dive Brief:

• Worldwide smartphone shipments grew 4.3% in the first quarter of 2017, according to International Data Corporation’s (IDC) Worldwide Quarterly Mobile Phone Tracker. That’s slightly higher than IDC's previous forecast of 3.6% growth. In total, smartphone manufacturers shipped 347.4 million smartphones worldwide between January 1 and the end of March, 2017.

• Samsung led the worldwide smartphone market despite 0% growth year-over-year, likely due at least in part to last year’s Galaxy Note 7 debacle. Apple smartphone sales also remained nearly flat, with shipments reaching 51.6 million units in the first quarter, up just a bit from the 51.2 million shipped in 2016.

• Chinese-based phone makers showed the strongest growth. Huawei alone grew nearly 22% as shipments climbed from 28.1 million units last year, to 34.2 million units in the first quarter of 2017. "Despite all the popularity and media hype around premium devices, we continue to witness a shift in many companies' portfolios geared towards affordable devices with premium-type styling compared to flagship models," said Anthony Scarsella, research manager with IDC's Worldwide Quarterly Mobile Phone Tracker, in an announcement. 

Dive Insight:

The smartphone market is alive and well despite a disastrous 2016 in which growth dropped into the low single digits for the first time. Although Samsung and Apple still lead the market, smaller Chinese companies Huawei, OPPO, and vivo are outpacing the two leaders with their more affordable devices.

As the market for premium phones becomes saturated, companies that offer these types of affordable "workhorse" phones may eventually drive more sales.

Meanwhile, saturation in the U.S.-based premium phone market is pushing companies like Apple and Samsung to innovate to increase interest in upgrades.

With its new Galaxy S8, Samsung is proving that innovation in the smartphone arena is indeed still possible. With the S8, Samsung is also hoping to make inroads in the enterprise market instead. A larger screen and several new capabilities designed to make workers more productive means the S8 could be the first smartphone to truly rival the office PC.

Apple, which has been criticized for a lack of innovation with its latest releases, is reportedly working on a special edition 10th anniversary iPhone that will finally move its designs forward.

And while it doesn’t fall into the category of moving design forward, BlackBerry plans to release its new KEYone at the end of May, CIO.com reports. Enterprise demand for that phone, which boasts an old-fashioned hardware keyboard, is said to be especially high in India and Indonesia.