The global smartphone market is sputtering in 2016, with Apple likely to see its first "down" year for the iPhone, a research report said Wednesday.

Research firm IDC said worldwide smartphone sales will likely increase just 3.1 percent to 1.48 billion units, after 10.5 percent growth last year.

IDC said it expects "low single digit growth" in the United States, Western Europe, and China while Japan and Canada are expected to contract by 6.4 percent and 6.9 percent, respectively.

The slowdown comes with the large markets generally saturated, and consumers keeping their handsets longer, because they are paying the full price without a subsidy from carriers.

"Consumers everywhere are getting savvy about how and where they buy their smartphones," said IDC's Ryan Reith.

This means that instead of getting devices from carriers, consumers are going directly to manufacturers or buying in online marketplaces.

"Consumers are having more say over which brands they want and at the same time able to bargain shop," Reith said.

IDC said Android's global dominance is likely to continue this year, with the Google-powered operating system in 84 percent of smartphones sold in 2016, up from 81 percent a year ago.

Apple is likely to see its first sales decline ever for the iPhone in 2016 -- a two percent drop to 227 million units, IDC predicted.

But IDC said Apple can bring iPhone back to growth in 2017 with its trade-in program as well as the lower cost iPhone SE.

IDC said the Windows Phone platform will see further declines as Microsoft shifts its focus. The report said Windows will account for just 0.8 percent of the market this year.

China smartphone maker Xiaomi buys Microsoft patents
Shanghai (AFP) June 1, 2016 - Upstart smartphone maker Xiaomi has bought nearly 1,500 patents from US technology giant Microsoft, the companies and reports said, as part of a "global partnership" that will help the Chinese firm expand outside its home market.

The patents cover wireless communications, video, cloud and multi-media technologies, Bloomberg News quoted a Xiaomi spokeswoman as saying.

"This will help ease of operation in new markets," spokeswoman Kaylene Hong said.

Besides the patent transfers, Xiaomi will pre-install Microsoft Office and Skype on its Android smartphones and tablets, Microsoft said in a statement. Xiaomi sold more than 70 million handsets last year.

In May, Microsoft announced the sale of its phone business for $350 million to a new Finnish company HMD Global and its Taiwanese partner, FIH Mobile of FoxConn Technology Group.

Microsoft bought the unprofitable handset unit of Finland's Nokia in 2014, but is now seeking to shut it down as it largely exits production.

"Microsoft is using its IP (intellectual property) arsenal as leverage to lure and lock-in vulnerable players such as Xiaomi," Neil Shah, research director at Counterpoint Research, told Bloomberg.

"So possibly it's a win-win for both parties as Xiaomi gets IP-protected and Microsoft grows its roster of partners."

Founded in 2010, Beijing-based Xiaomi was the world's fifth biggest smartphone vendor at the end of last year, shipping 18.2 million phones in the fourth quarter of 2015, according to International Data Corp (IDC).

However, despite its efforts in India and Brazil, Xiaomi still depends heavily on the domestic market, which accounted for 90 percent of its sales volume last year, IDC said.