卦Trigram 2.0
Asian Snowcrash

A little behind the pack, the IHT has run a feature today on the Spice phone (previously discussed by the Times and Reuters). Niti is worried about the phone, and is concerned that it is patronizing the poor.

I don’t think that’s the case. Niti’s points about the value of the screen, and of data services are all valid. However… let’s remember that the purpose of a company, a business, is not to offer goods or services that ought to exist, but to offer goods or services that will sell… That’s over-simplistic, of course, but it will serve for now.

So, will the Spice phone sell? I think so… but to whom? The people Niti has in mind are, I think, economically-active adults at the bottom of the pyramid. Even if it’s being billed as “the People’s phone”, I don’t think it’s intended for that niche. If it is, then maybe it’s a case of Spice spectacularly misunderstanding the market, rather than being patronising. This segment does need the data services and are more likely to buy a second-hand but more versatile phone for the same price - or so I would have thought, but let’s not underestimate people’s liking for “new and shiny” versus “second-hand and grimy”.

So who is a more likely market? The IHT article backs up and extends my musings when I wrote about this before - a rather more affluent segment, who want a call-only phone for:

• the older generation, eg my parents, who simply want a phone they can use just to keep in touch - usually with friends or family whose numbers they have memorised anyway, from long usage with a landline (or which, more likely, are stored in a battered old paper address book that they certainly are not going to painstakingly copy into a phone);
• parents, who want to give a phone to their school-age child for safety, or for general contact needs, but don’t want the child to get immersed in games, constant SMS exchanges with friends, etc…
• … and who else?

Of course, these markets extend far beyond India. And perhaps I’m wrong - perhaps even at the bottom of the pyramid there is a demand? After all, who exactly is making the enquiries from Africa, Indonesia, etc?

So, some options:

• There is no market at the BoP; Spice are patronising the poor, with the attitude “These people don’t need anything more”;
• There is a market at a slightly higher income bracket, but a niche one (caveat: People’s Phone does not necessarily mean “for the poor”; the original Volkswagen - ie People’s car - was, after all, designed for the aspirational working class/lower middle class. BTW, I invoke Godwin’s Law here: no mention of That Name, please.);
• There is a market at the BoP, and I’ve misjudged the needs of this segment.

As I said before, the proof of the pudding is in the eating. The phone hasn’t actually hit the market yet; let’s see how it sells…

This entry was posted on Thursday, March 13th, 2008 at 8:43 am and is filed under Asia, Mobile telephony, design, developing markets. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.