Why emerging markets excite smartphone manufacturers
GOOGLE is reportedly developing a new mid-range Pixel phone, targeted at “price sensitive markets such as India”.
Previously, the Pixel phone was positioned to rival premium smartphone like the iPhone – which is why the new focus is making consumers wonder about the company’s intentions. However, analysts think their “new” focus into mid-range offerings makes complete sense.
In many emerging markets, mobile operators are aggressively growing their subscriber base which is fuelling the growth of connected devices – which brings lucrative opportunities for smartphone makers and other businesses.
Numbers back this up. Globally, there are more mobile phones connected compared to desktops and tablets combined. In Asia, the numbers are even greater – with more than 65 percent of connected devices being mobile phones.
Demand is getting stronger in emerging markets. In 2017, IDC India recorded a 14 percent growth in total shipment of smartphones. With less legacy infrastructure weighing them down, developing countries can focus on rolling out the best available technology.
Google has been actively leading the industry in reaching out to emerging markets. Last year at Google I/O, Google CEO Sundar Pichai revealed Android Go, a lighter version of Android developed for “cheaper” phones that didn’t come with more than 1GB of RAM.
In many rural areas, infrastructure isn’t as frequently updated with the latest tech. Many tech companies such as Facebook and Twitter offer a “lite” version of their apps, allowing users access to essential features without demanding too much in terms of device memory or internet speed.
— Cobry (@cobry) April 2, 2018
For any tech company, serving the rural population in emerging markets means big money. It also gives companies the opportunity to lock in loyal customers – as buying power increases, users can graduate to more premium offerings by the company.
This strategy isn’t new: Chinese device makers have been doing this for nearly a decade. Brands like Oppo, Vivo, and Xiaomi are budget devices aiming at the largest market in China – rural families on a low income. Even Huawei, who positions itself against premium brands like Samsung and Apple owns a wallet-friendly “sub-brand” it calls Honor.
In fact, Chinese makers have already captured a major market share in India. Xiaomi alone has taken more than a quarter of the Indian market. Combined with fellow makers Oppo, Vivo, and Lenovo, Chinese brands make up more than half of the smartphone market in India.
Still, emerging markets present a huge opportunity, not only for tech adoption but also for new innovations. Google’s effort to provide a larger population with greater access to practical technology paves the way for other products and services to follow suit.