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Summary:

Nokia and Motorola’s aggressive push into low cost mobile phone business might have wreaked havoc on their margins, but there is no denying that the two giants have posted major market share gains in recent quarters. The rivals are waking up, and reacting with their own […]

Nokia and Motorola’s aggressive push into low cost mobile phone business might have wreaked havoc on their margins, but there is no denying that the two giants have posted major market share gains in recent quarters.

The rivals are waking up, and reacting with their own low-cost mobile phone strategies. Samsung is expected to launch five new low and medium-end handsets that would cost between $45 to $145, according to Packetology, a research and consulting group.

Even though it has some low-end offerings in India, Samsung has been focusing on the medium to the top end of the market. “For a change, these handsets would make their global launch in India and not Korea or the UK,” says Aman Kapoor, principal with Packetology.

The new range will include the $55 dollar C-140; C300, an entry-level slider phone that is a derivative of D820 and will retail in India for $88.

Samsung will also introduce the X520, a Krzr styled clamshell in two colors – Burgundy and Purple. Samsung X530 is another slider and will cost $111, and E250 will be the most expensive handset launched, and will cost about $145 at retail.

  1. Wonder when the RAZR gets introduced in India

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    1. This is probably a good tactic for the short run, but a poor strategy in the long run. If you dump low capability handsets in the market, the capability to introduce Value Added Services goes down drastically.

    2. The correct thing to do would be to introduce the service agreement stuff and provide good handsets.

    3. This will severely limit the potential services set : its just voice and sms, really.

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  2. This is smart. There are clearly two ends to the market in India, just like in many other markets. Your vegetable vendor is not going to buy the Q, but he already has a phone, so that’s the market. And it is huge.

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  3. Petabro meant Blackjack in the first post

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  4. difficult to do service agreement stuff in india (as they dont have a national SSN type scheme and no credit bureaus)..Reliance tried doing something similar whne they launched. everyone just took the handset and ran with it and never paid any bill, treating it a as a prepaid disposable phone..

    also arpu boost and churn redux will not be enough to subsidize handsets…so it may be a non starter

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  5. DrDoubt said: “This will severely limit the potential services set : its just voice and sms, really.”

    In Indian market thats all matters, Lot of comments here have already said about this, Indian market is not like American market where you sell a handset at discount and milk the money through contracts. Majority there is prepaid customers who enjoy the benefits of free (unlimited) incoming calls and just Rs 1 per minute for outgoing calls (2cents).

    Of course there is a segment of people who wants to show off their phones, and that market is also quite sizable, but it is nothing compared to the vegetable vendors and others where good growth potential is there.

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  6. I wonder how these phone manufacturers manage to stay profitable with a low cost handset product line – with which they expect to proliferate the market.

    Consider this: According to research reports mobile companies have lost billions of $$ in terms of return and repair for handsets.

    Considering that the R&R is priced in for the low cost phone – I still am not convinced that the market for “low” cost phones is viable.

    If you are targeting the rural rich and the urban poor – the so called poor – let me tell you this – They will “spend” money – hard earned money for a cool gadget and nothing cheap!

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  7. maulinkumar rao Thursday, January 25, 2007

    it is very difficult to understand the power of mass in current economy. imagine a can which is selling for 3000$ (yes brand new) will be largest selling model in few years. if 1 percent of population start is captured by this phones companies will make more money.

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  8. Petabro:
    the RAZOR is already in indian market. However, it is not as famous as it is here.

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  9. Made the correction earlier. You should read all the posts – not just the first one

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