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45 percent smartphones shipped to cost $200 by 2014
By siliconindia
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Wednesday, 04 November 2009, 22:52 IST
New York: The prices of smartphones are falling as shipment volumes increase, and a new study from ABI Research says that 27 percent of smartphones are available of cost under $200, as compared to 18 percent in 2007.
The firm forecasts say that 45 percent of the smartphones shipped will be priced below $200 by 2014. This highlights a rapid change in the attitude of the consumers about smartphones, and a similar shift in vendors' and mobile operators' sales and marketing strategies.
"Manufacturers see consumers increasingly demanding smartphones, because of their better understanding of the value that a smartphone delivers. Nearly all consumers used to choose handsets based on the physical characteristics of the hardware, not the software inside," said Kevin Burden, Practice Director, Mobile Devices, ABI Research.
"The iPhone has changed this, as more users are now shopping for their handset based on the operating system and software, which is something once thought to be very unlikely," said Burden.
More and more smartphones and conventional phones are now priced in similar ranges. The marketing strategies of handset makers and carriers must accommodate both groups of consumers - those who want a basic replacement phone, and those who care about what the operating system can do for them.
In some of the markets, these strategies get more complicated by the heavy subsidies that mobile operators offer.
Some smartphones are never subsidized, as the high end phones are intended as prestige items or to demonstrate a manufacturer's design and innovation skills. Increasingly, manufacturers want to offer a mix, some high priced, high margin models, but also a generous helping of moderately priced smartphones that can generate good sales.
According to ABI Research, the greatest increase in smartphone shipment figures over the next five years will be found in the price range of $100-200.
"Prices will hold at a certain point. We may never see a $30 smartphone. But over time, smartphones will take a substantial part of the mainstream handset market," said Burden.
ABI Research's 'Smartphone and OS Markets' analyzes the regional markets for smartphones, the outlook for the competing high level operating platforms.
