Samsung eyes low-price phones for emerging markets

Samsung is considering selling low-priced mobile phones in emerging markets to take on market leader Nokia, an Associated Press report said.

The Associated Press report said Samsung, the world's second-largest mobile phone maker by volume, plans to unveil color mobile phones in a $40-$50 range this year in markets such as India, Southeast Asia and Latin America, according to company spokesman Kim Tae-hoon.

'We want to become an all-around player in the handset market,' Kim was quoted by the report as saying. 'Samsung hopes to move away from its focus on premium products to accelerate its penetration into emerging markets.'

In the past, the South Korean company has branded itself as a supplier of high-end handsets equipped with premium features.

'Samsung needs to increase its market share to achieve economies of scale like Nokia,' said Kim Kang-oh, an analyst at Daishin Securities. 'But a shift to low-end products will definitely hurt its profits.'

The rpeort added that Samsung plans to launch the low-end handsets 'only if it can secure cost competitiveness,' according to Kim, the Samsung spokesman, adding that it's still studying the feasibility of the project.

Samsung overtook Motorola in the second quarter of 2007 to become the world's second-largest handset maker by volume. It said in October the average selling price of its handsets increased 2% to $151 in the third quarter compared to the second.

The company is targeting global sales of 200 million handsets this year and aims to raise its global market share to 25% by 2010, Kim said.