The overall growth of China's smartphone market will slow down this year compared with 2016, with product updates and replacements being a key driving force, said a report released by research firm GfK.

GfK estimated that with the depreciation of the yuan and rising cost of components, competition in the smartphone market would become more intense.

Meanwhile, the growth rate in sales revenue of smartphones will be higher than that of sales volumes, with the average price of a smartphone rising this year, it said.

The sales volume of smartphones is expected to reach 493 million units in 2017, up 4.8 percent year-on-year, while revenue will come in at 980 billion yuan ($142.4 billion), for an increase of 11.4 percent compared with last year, according to GfK.

Sun Kai, general manager of GfK China's technology department, said consumers were more likely to choose medium and high-end products this year.

He said handset manufacturers such as Oppo Electronics Corp, Vivo Mobile Communication Technology and Gionee Communications Equipment Co Ltd, would join hands with e-commerce giants to come to first-tier cities with flagship products in the current year.

Their online sales volumes increased 75 percent year-on-year in 2016, with sales revenue up 103 percent compared with the same period of previous year.

"The integration of online and offline sales will be the long-term trend as the mobile internet has shown major advantages," said Bao Ran, secretary general of China Smart Multimedia Terminal Technology Association.

The GfK report added that sales from the online market would increase 15.1 percent year-on-year, while sales in the offline market would witness an increase of 4.1 percent this year compared with 2016.