Disruptive Tech Theme of the Week: The Smartphone

It may not be new, but one of the best modern-day examples of disruptive technology is the smartphone. It is a technology that has radically disrupted human behavior and changed how we live our daily lives. The smartphone has not merely replaced the need for landline phones but changed how we engage with the world from social media to online shopping to digital photography to video to music consumption to payment. It can even monitor your heart rate and start your car.

Globally, there are approximately 6.84 billion smartphones. To put that in perspective, that accounts for 85% of the global population. China has the most smartphone users (63.8% penetration), followed by India (45.7% penetration), and then the United States (73.7% penetration). While the global numbers are staggering, there are still people in the world who do not and cannot have access to a smartphone because 1.1 billion people (1 in 8 people) still do not have access to electricity. Smartphones are also a gateway to financial inclusion for underserved populations.

Source: NewZoo

Who are the main players in the smartphone supply chain ecosystem? According to Oberlo, Apple (28%) and Samsung (24%) have the greatest market share, and Chinese brand Xiaomi (11.2%) comes in third.

So, How do you Best Play This Disruptive Investment Trend as an Investor?

Interestingly, there is no longer a “smartphone ETF”. First Trust’s Smartphone ETF is now the First Trust Indxx NextG ETF (NXTG), joining the Defiance Next Gen Connectivity ETF (FIVG) as an ETF play on 5G networking and communications technology. Another smaller ETF is the AXS Esoterica NEXTG Economy ETF (WUGI). These products seem more focused on cellular technology and providers than mobile applications.

The Global X Internet of Things ETF (SNSR) has been around since 2016, and it is another way to get exposure to all internet-enabled devices. The fund includes exposure to smart home, wearable, and smart grid devices and applications.