Tricia Wang

Nokia‘s CEO Stephen Elop suggest that smartphones are only in reach of 10 percent of the population. Wrong, says researcher Tricia Wang, who is observing how the remaining 90 percent in China is getting ready to purchase a smartphone. From her weblog.

Tricia Wang explains what the Taiwanese firm Mediatek is doing in the market for smartphones:

I have several thoughts about Elop‘s comment:

  • There are already companies that are ready to offer the 90% a very affordable smartphone.
  • It is misleading to think that this 90% won’t spend more on cellphones than they did on feature phones.
  • Although this 90% can’t afford a smartphone now, it doesn’t mean that they don’t want one in the near future.

It would’ve been more accurate for Elop to say, “previously, 90 percent of the world could not afford a smartphone or a high-end device, but we are going to see affordable smarpthones enter the market and users who will spend more on mobiles…This creates an opportunity.”

But I suspect that the reason why Nokia’s CEO made his statement is because the market has yet to see the flooding of affordable smartphones. This is because Mediatek, the platform on shanzai phones, up until recently has only been able to offer 2G chips, not 3G chips.  But Mediatek is beginning to produce Android smartphones with their 3G MTK6516 cellphone chips, the first affordable shanzai smartphone. And now that Mediatek has sorted out legal issues with Qualcomm in a across-patent liscensing deal, they are moving upmarket and ensuring that their 2G customers transition to their 3G handsets.

So this means guerilla warfare on the smartphone market: Chinese cellphone makers will soon be producing smartphonesthat are much less expensive than the current array of smartphones ( i.e. iphones, HTCs, samsungs, and ericssons).

Can Nokia and Microsoft together work out a strategy to fight this new development?

Tricia Wang:

In my research with non-elite users around the world, Nokia has always been at the heart of every conversation about cellphones. But I’ve noticed the decreasing ownership and desire of Nokia phones in the last 3-4 years, and it is even more apparent over the last year. The 3G market among non-elite users is already being created by current advertisement for high-end smartphones from iphone to HTC to Motorola. Cellphone vendors are selling 3G phones even in second hand cellphone markets. So even if non-elite users can’t afford these phones, their desires for one are being nutured.High-end smartphones are paving the way for shanzai smartphones.

More on Tricia Wang’s weblog.

Tricia Wang is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch. You can also use our speakers’ request form.

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