Lots going on in the world of mobile telephony over the last few days…
The headlines seem to have been captured by India, where Mumbai-based company Spice - who, astonishingly, have no entry in Wikipedia (at least, not when I checked a few moments ago; no doubt one will appear in short order - have introduced the so-called “People’s Phone”. They’re targeting the bottom end of the market with a back-to-basics phone that does nothing but make calls. No screen, no SMS, no games, tools, calculator, nothing… just calls. According to the London Times, it’ll cost £10 - which, according to Yahoo! Finance means 27.83 Singapore dollars / 19.67 US dollars / 780 Indian Rupees / 141 RMB at today’s rates.
Reuters add more detail and insight. Spice will market the new phone “from Iraq to Indonesia“; apparently they believe that the key issue to breaking into the developing market, the bottom of the pyramid, is the price of the handset (my emphasis). Well, I’m sure they have done their research and know better than me - but that sounds very surprising to me. Cheap second-hand phones are already widely available through much of this market, it seems to me, and I’m fairly certain that an SMS culture is also well-established. That would suggest to me that the real barrier would be the cost of airtime, messaging, and other services. Well, the proof of the pudding is in the eating, and it will be interesting to see how well this “People’s Phone” sells after its introduction next month. (It also seems to be missing a market; I know plenty of Brits of my parents’ generation who would be delighted to get their hands on a really cheap phone that does nothing but calls!).
A contrasting approach comes from Singapore-based Jurong Technologies. They’ve partnered with Infineon Technologies, TJAT Systems, and Brightstar Corporation to introduce a budget Smart Entry Phone, featuring various instant messaging services (Yahoo!, MSN, ICQ) plus email. According to the Business Times, it will cost “around $50“. Looking at everything else on the same page, I see that the Business Times explicitly says “US$” in other articles; I therefore conclude that they mean 50 Singapore dollars. So, that’s: £17.98 / 35.35 US Dollars / 1,401 Rupees / 253 RMB. The consortium also see Asian developing markets, and India in particular, as their main focus. Same questions, though - how will the airtime and services be priced?
That creates a very narrow price band between ultra-basic at USD19.67 at the very bottom, and email- & chat-enabled at USD 35.5… Where will other models fit in? What other combinations of features and price would compete?
At any rate, these examples show that the price of a new handset is falling significantly and rapidly, for both basic and more highly-featured models. I’ll take a look at what’s happening in China after I get there; I remain convinced that for all the headlines about India, there is much more genuine innovation going on in China, which will at some point hit other markets…
As for service costs, it’s very good news that China is about to dramatically cut the costs of roaming charges for calls made between provinces- by between 54% and 73% according to China Daily, which gives fairly detailed examples. That will make calling more affordable for migrant workers… What barriers are there “from Iraq to Indonesia”? And, of course, why does nobody seem to be talking about Africa?
Interesting articles:
Update Feb 16:
China Digital Times has an intriguing piece about one Chinese blogger’s ‘participation’ in the meeting regarding roaming charges.