How Cheap Smartphones will Impact Consumers and Business Owners

While the trend for affordable smartphones may have emerged in Central Europe, it is in the Asian market where it continues to have the most significant impact. This is best embodied by the performance of the Mozilla Firefox smartphone, which is the world’s cheapest handset and is available in India for just $33. It has already recorded considerable sales figures since its launch last week, with projected figures suggesting that the company may shift a staggering 500,000 by the end of 2014.

Featuring Cloud technology and Firefox’s high-performance operating system, these handsets are more than 30% cheaper than even any existing smartphone that utilises Google Inc.’s Android software. Striking the ideal balance between cost and performance, they have the potential to revolutionise the smartphone market and the experience of both consumers and business owners alike.

What it means for Mobile Developers and Network Operators

In general terms, the cost of procuring and operating smartphones has been falling steadily for more than eighteen months. There are numerous factors behind this, with intensifying market competition between established vendors and mobile network operators arguably the most influential. This has forced companies to create more affordable handsets and usage tariffs, and the existing range of affordable iPhone 5s contract deals showcases this perfectly. Firms such as Apple and Samsung have also benefitted from the falling cost of smartphone components, as they have been able to share these savings with loyal and new customers.

The reduced cost of components has also created a gap in the smartphone market, however, and this has been ruthlessly exploited by cheaper brands. These companies have essentially used accessible technology to transform the traditional feature phone, and equip it with online connectivity while charging a vastly reduced retail price. So rather than being able to maintain their market dominance with a wider range of pricing options, leading firms such as Samsung have experienced declining profits and lost valuable customer among less affluent demographics.

What does this mean for Businesses and Customers?

There are unlikely to be too many tears shed for companies like Samsung or Apple, however, as the benefits to business owners and customers are almost innumerable. The smartphone industry now represents a buyers’ market, for example, as customers have a huge range of handsets and price points to choose from when shopping. More importantly, they are required to make less of a compromise when investing in a low-cost smartphone, as even basic models are now likely to feature reliable Internet connectivity, viable operating systems and Cloud technology.

The same principle applies to business owners, especially small or independent ventures that have minimal financial resources. Take start-up companies, for example, who require a basic collection of functional smartphones that enable users to make calls, access email accounts and view documents. These can now be sourced for next to nothing from the European and Asian markets, so business owners need no longer invest heavily in mobile devices that are equipped with unnecessary technology and advanced features.

The Last Word: What Course will the Market Take in 2015?

There is already a multitude of smartphone trends forecast for 2015, with the release of Google’s ground-breaking and patented modular phone undoubtedly the most intriguing. Even this will potentially provide a relatively cheap option for consumers, however, thanks to the availability of an affordable processor and the users’ ability to upgrade individual components rather than an entire handset.

In addition to this, the increased affordability of smartphone components and the accessibility of the required technology are likely to create even more affordable handsets over time. As a growing number of players enter the market and improve the typical design of cheap smartphones, larger brands will be forced to alter their proposition and offer more competitive deals if they are to retain their dominance. Whether this involves reducing their price points further or adding extra value through innovative technology remains to be seen, although decisive action may be required if brands such as Samsung are to remain Omni-potent.

Image: – Smartphones / Flickr

Mozbot Team