Google's (NASDAQ: GOOG) Motorola Mobility and BlackBerry (NASDAQ:BBRY) are both banking on the shift to lower-cost smartphones for growth, evidenced by the new phones they just unveiled aimed at the cost-conscious segment of the market.
Motorola is aiming at the entry-level Android market with its newest device, the Moto E, a trimmed down version of the Moto G smartphone it released late last year. The Moto E costs $129 online for an unlocked GSM version without a contract. Motorola said the Moto E will be available in more than 40 countries through more than 80 carrier partners around the world over the next few weeks, though it did not announce any U.S. carrier partners.
With the Moto E, Motorola is clearly aiming to get feature phone customers to trade up to a low-cost smartphone. "The fact is, about 70% of mobile phone users in the world are still using feature phones that can't unlock the full wonder of the mobile Internet, in many cases because they don't think it's worth the $337 for a smartphone (the average selling price globally in 2013)," Motorola wrote in a company blog post introducing the Moto E. "We believe it's time the feature phone era came to an end and that quality smartphones are made accessible and affordable for all."
The Moto E features similar but whittled-down specs compared to the Moto G, which Motorola unveiled in November for $179 off contract. The Moto E runs Android 4.4.2 KitKat, and Motorola has promised at least one major software update. The Moto E also sports a 1.2 GHz dual-core Qualcomm (NASDAQ:QCOM) Snapdragon 200 processor with 1GB of RAM and 4 GB of internal storage, a 4.3- inch display and a 5-megapixel camera, though no front-facing camera.
"We believe that a quality mobile experience is a right, not a privilege," Charlie Tritschler, senior vice president of product at Motorola, told CNET.
Motorola also announced an LTE version of the Moto G for $219 without a contract. Motorola said it sold 6.5 million devices in the first quarter, thanks in large part to the Moto G.
BlackBerry is also getting into the low-cost smartphone game with the Z3 Jakarta Edition, a phone specifically designed for the Indonesian market. The phone was unveiled at a glitzy event at the Ritz-Carlton hotel in Jakarta. The device, which sports a 5-inch touchscreen display and runs BlackBerry 10, will go on sale May 15 for around $190 on an unsubsidized basis.
BlackBerry CEO John Chen is aiming to use the Z3 to revive the company's sales and serve as a template for how it can get legacy BlackBerry 7 users to upgrade to BlackBerry 10 in emerging markets like Indonesia.
Chen denied that the phone is a last-ditch effort to remain relevant, and instead said it would part of what would help revive the BlackBerry brand. "BlackBerry has new technology and is financially stable," he said at a news conference after the unveiling, according to the New York Times. "I think that's got to be the first step--to explain that."
"When people have no concerns about BlackBerry the company," he added, "then the product will be cool again."
The Z3 Jakarta Edition will support a Bahasa language typing experience on a touchscreen and users will also be able to enjoy content exclusive to Indonesia on their device, including a special set of BBM Stickers featuring local characters, The Punakawan, by Indonesian illustrator Susilo Saptoady.
BlackBerry once commanded 40 percent of the Indonesian smartphone market, but that has shrunk to 4 percent, according to research firm IDC. Samsung Electronics now dominates the market.
"If this device allows them to grow again, even if it's just small, steady growth, that's a success in itself. That says there is still room for BlackBerry in Indonesia," IDC analyst Ryan Lai told Reuters.
HTC is another company working to get more low-cost but high-spec phones into its lineup. The company has reportedly started selling smartphones priced as low as $145 on an unsubsidized basis this quarter with the help of contract manufacturers in an effort gain share in emerging markets. HTC is hoping its Desire-branded phones can help out in the mid-tier by borrowing much of the design language from its higher-end One.
Research firms have been predicting that inexpensive smartphones will soon dominate the market. ABI Research predicted in April 2013 that smartphones costing $250 or less before carrier subsidies will make up 46 percent of all global smartphone shipments by 2018, up from 28 percent in 2012.
- see this Motorola blog post
- see this The Verge article
- see this CNET article
- see this Re/Code article
- see this BlackBerry release
- see this NYT article
- see this Reuters article
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