05 March 2012

It's Smartphone Tsunami From China

Some IT industry analysts and observers, especially those who have been watching the market as far back as the PC age, are predicting that today’s newfangled and most-lusted-after smartphones will soon be as commoditized as today’s refrigerators and washing machines.
Now, if you would care to turn back the hands of time by a decade or two, you might recall that personal computers, both the desktop and laptop varieties, used to cost PC owners an arm or two and a pair of legs. Sometimes, PC buyers had to even throw in a head and some innards.

PCs that were not that powerful and lacked some of the features and functions consumers today take for granted were that expensive. And consumers had no choice but shell out the money or they could remain “un-computered,” something that even back then was already detrimental to one’s career and personal advancement.
Then the clones came. Combined with the advances in manufacturing, components, and computing technologies, the non-branded computers really drove down prices of PCs, which then started coming with features and capabilities that users from just the previous couple of years or so never heard of.
The computer had just become a Frigidaire.
Low-Cost, High-End
In conjunction with and accelerating further the process of the smartphone’s commoditization is the China-based manufacturers’ ongoing introduction of smartphone models that can go toe-to-toe with those manufactured by Western and Japanese vendors but at cheaper prices.
This year, Chinese vendors Huawei Technologies Co. Ltd. and ZTE Corp. aim at grabbing bigger shares of the global market. These highly nimble manufacturers are shifting their focus from manufacturing feature phones to producing more smartphones, a faster growing and more profitable segment, at least for now.
Combined, these giants account for about 7 percent of the world market, selling some 35 million smartphones in 2011, a number forecast to rise to 90 million in 2012. By then, the companies’ share of the market will balloon to 14 percent.
Manufacturers in China have been associated with turning out cheap knockoffs (a reputation not unfairly earned, if we might say so), but Huawei and ZTE have been consistently disproving the notion by creating original and well-designed gadgets and devices. They, however, retained the “low-cost” part, most of the time.
Huawei, for example, launched at the 2012 Mobile World Congress in Barcelona what it claims is the world’s fastest smartphone, the Ascend D Quad. This Huawei smartphone comes with a quad-core processor, which makes it twice as powerful as the formerly trailblazing dual-core processor-equipped smartphones.
Outside of their home market, these companies will focus their business expansion efforts on Europe, Japan, and the United States.
Time to Panic?
Currently, the global market for smartphones is ruled by Apple with its iPhone, followed by Samsung with its Galaxy line of bestsellers. Android, however, is used on more than 50 percent of smartphones, with some 800,000 units of Android-running devices activated each day.
While Research In Motion is trying hard to recover market share, the Nokia-Microsoft alliance is dying to become relevant.
While the iPhone seems steady and immune from all these, the Android makers, RIM, and, most of all, Nokia-Microsoft must recover their competitive streaks fast, before this looming tidal wave from China comes to engulf them.




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