"We are now starting to see a market that is becoming less about capturing the low-hanging fruit of first-time smartphone users and moving into the more laborious process of convincing existing users why they should upgrade to this year's model."
The report also highlights two trends shaping the future of the Asia-Pacific smartphone market. As China's smartphone market becomes increasingly crowded, growth will shift to other emerging markets.
"While India volumes significantly lag (behind) China, India has taken the number three ranking of largest smartphone markets in the world in 2013" the statement said.
China's smartphone makers, who are no longer content with the Chinese market alone, are setting their sights on overseas expansion.
(Read more: China's 4G smartphone market is about to explode)
"China players are getting hungrier to turn themselves into international rather than China-only brands" the statement said.
The latest example of this was seen in Lenovo's acquisition of Motorola's handset business. Meanwhile smaller Chinese smartphone manufacturers such as Oppo, BBK, Gionee and Xiaomi, are increasing their international expansion.