In most developing nations, the typical Android smartphone -- typically selling for $400 to $500 -- is way out of reach for many consumers that currently have a feature phone or perhaps no phone at all.
These potential smartphone owners currently only have one operating system (OS) choice in the low-cost category, (the under-$150 segment) and that is Google Android. Besides, the only mobile service they can afford will most likely be pre-paid.
According to the latest market study by In-Stat, they now forecast that unit shipments for low-cost Android smartphones will approach 340 million worldwide in 2015.
“The low-cost Android handset segment will cause some fragmentation in the Android platform,” says Allen Nogee, Research Director at In-Stat.
Most low-cost Android smartphones are likely to be released with Android 2.2 or 2.3, since these versions are a good blend of features with modest memory and processor usage.
The Ice Cream Sandwich (Android 4.0) step-up in memory and processor demands makes this release less attractive for low-cost Android devices.
In-Stat's latest market study insights include:
- The low-cost smartphone area is Android’s to lose. This market could get much more competitive, especially as other OS vendors begin to target the space.
- The low-end low-cost smartphones generally stick with EDGE and processors running at 600MHz speeds or less, and a single-core EDGE chip sells for well under $10.
- Low-cost means smartphones that are $150 or less.
- Smaller phone manufacturers will sometimes purchase from the “gray market” where component manufacturers typically don't pay licensee fees, royalties, and taxes for the products they produce.
- Early competitors in the market include Huawei, MicroMax, Motorola, Samsung, Spice, and ZTE.