Skip to main content

Why Smartphone Competition will Escalate in 2013

According to the latest market study by Informa Telecoms & Media, the smartphone market will start to diverge and sales will become dominated by two distinct categories -- low-end devices (priced below $150) and high-end devices (priced above $250).

Overall, the pricing trend is downward. More expensive smartphones will find their market share shrinking from 85 percent of total smartphones sold in 2011 to 33 percent in 2017.

In contrast, the low-end smartphones will gain significant new market share during the coming years to account for just over half (52 percent) of all the smartphones sold in 2017.

The smartphone market is undergoing change -- whereby demand will be increasingly polarized between expensive and heavily-subsidized handsets, and affordable devices targeting the emerging markets.

As a result, smartphone competition is becoming more intense.

The average smartphone price will drop from $188 in 2011 to $152 in 2017 -- as a result of balancing the huge demand for entry-level smartphones in emerging markets with the demand for super-smartphones in developed markets.

The average gross margin for a device is expected to remain flat -- in the range of 20 -25 percent. This is because smartphone vendors will increasingly be under pressure to absorb the cost of innovation while keeping up with price competition.

Informa believes that in order to remain profitable, some vendors will have to continue to reduce their operational costs, while others will struggle to maintain profitability.

"As the market develops, the supply chain will increasingly be divided between two camps -- the innovators who will continue to introduce new features and high-performance components to the market place and followers who will take this innovation to the mass market in later years," said Malik Saadi, principal analyst at Informa Telecoms & Media.

These changes will push some established manufacturers to reposition themselves in the new environment and come out with more effective handset-pricing strategies.

Only a few manufacturers will have the ability to operate right across the market, the great majority will have to focus on particular segments to reduce cost and maximize margins.

The established vendors will find it hard to adapt to the new smartphone landscape -- as this could take them away from their core business, servicing the core high-end smartphone market.

These smartphone vendors will have to make a strategic decision to either fight in the high-end segment, or alternatively face stiff competition by assemblers and Chinese ODMs in the low-end segment.

Popular posts from this blog

Industrial and Manufacturing Technology Growth

In an evolving era of rapid advancement, market demand for innovative technology in the industrial and manufacturing sectors is skyrocketing. Leaders are recognizing the immense potential of digital transformation and are driving initiatives to integrate technologies into their business operations.  These initiatives aim to enhance efficiency, reduce costs, and ultimately drive growth and competitiveness in an increasingly digital business upward trajectory. The industrial and manufacturing sectors have been the backbone of the Global Networked Economy, contributing $16 trillion in value in 2021. Industrial and Manufacturing Tech Market Development   This growth represents a 20 percent increase from 2020, highlighting the resilience and adaptability of these sectors in the face of unprecedented challenges, according to the latest worldwide market study by ABI Research . The five largest manufacturing verticals -- automotive, computer and electronic, primary metal, food, and machinery -

Rise of AI-Enabled Smart Traffic Management

The demand for smart traffic management systems has grown due to rising urban populations and increasing vehicle ownership. With more people and cars concentrated in cities, problems like traffic congestion, air pollution, and greenhouse gas emissions are pressing issues. Since the early 2000s, government leaders have been exploring ways to leverage advances in IoT connectivity, sensors, artificial intelligence (AI), and data analytics to address these transportation challenges. The concept of a Smart City emerged in the 2010s, with smart mobility and intelligent traffic management as key components.  Smart Traffic Management Market Development Concerns about continued climate change, as well as cost savings from improved traffic flow, have further motivated local government investment in these advanced systems. According to the latest worldwide market study by Juniper Research, they found that by 2028, smart traffic management investment will be up by 75 percent from a 2023 figure of

GenAI Revolution: The Future of B2B Sales Apps

When B2B buyers consider a purchase they spend just 17 percent of that time meeting with vendors. When they are comparing multiple suppliers‚ time spent with any one salesperson is 5 or 6 percent. Self-directed B2B buyer online research has already changed procurement. IT vendors are less likely to be involved in solution assessment. Now, more disruptive changes are on the horizon. By 2028, 60 percent of B2B seller work will be executed through conversational user interfaces via Generative Artificial Intelligence sales technologies -- that's up from less than 5 percent in 2023, according to Gartner. Generative AI Market Development "Sales operations leaders and their technology teams must prepare for the convergence of new forms of artificial intelligence, dynamic process automation, and reinvented deal-planning activities that will transform the sales function," said Adnan Zijadic, director analyst at Gartner . According to the Gartner assessment, Generative AI (GenAI) s