Does all the excitement about super-advanced smartphones and tablets sound the death knell for low-end phones? Well, not exactly. CNET’s Jessica Dolcourt reported at last month’s Mobile World Congress (MWC) that “There were a few superphones…but for the most part, it was budget-friendly fare that hogged the spotlight.”
Despite the low margins in the “affordable” phone market, there’s still plenty of gold in them thar hills. With only one-third of the world now connected to the Internet, there’s tremendous opportunity ahead for the mobile industry.
Over the next five years or so, the next two billion mobile connections will come from emerging countries, where customers tend to be more price sensitive than their counterparts in the developed world. So what’s the best way to reach them? That was the topic of a C-level panel at MWC, where Mozilla CEO Gary Kovacs noted that many of these new mobile adopters could be experiencing the Internet for the first time via their mobile devices. (Check out our interview with Mozilla’s VP of engineering talking about the new Firefox OS here.)
But will that massive migration to the mobile Internet come from users with high-end feature phones or low-end smartphones? Basically, the lines between the two are blurring. Part of Nokia’s strategy, as articulated by CEO Stephen Elop, is to “bring the Internet to emerging markets via basic phones that offer a lot of features.” For example, Nokia’s low-end phones (such as the Nokia 105) have the Xpress browser, a cloud-based Internet service that runs faster than traditional browsers and consumes less data by offering a stripped-down version of the Web.
On the other hand, there’s nothing to prevent the mighty smartphone from tiering downward, eventually becoming a mass-market device. That message was delivered by Manoj Kohli, CEO of Bharti Airtel, a major network operator in India, Sri Lanka, Bangladesh and 16 countries in Africa. Speaking at the MWC panel, Kohli argued that “Smartphone adoption is key to bringing people to the Internet,” calling on device manufacturers to provide $30 price points for smartphones.
Smartphone shipments are expected to overtake feature phone shipments this year, and some argue that all phones will eventually be smartphones. For now, though, putting the debate about the type of device aside, the expectation is that affordable phones will drive the next level of growth for the mobile Internet.