With mobile phone markets nearly saturated in the developed world, network operators and handset manufacturers are turning their attention to the fertile ground of emerging countries.
Making affordable phones and targeting consumers with smaller budgets have now become priorities for the largest companies in the sector who were all present at this week's 3GSM trade show in Barcelona.
"There are between 2.5 and 2.8 billion people who have a mobile phone: the next billion will come from the high-growth market," said David Taylor, strategy director for Motorola.
PHOTO: AFP
The areas representing the most opportunity are Asia, Africa and the Middle East, he said.
European telecommunications institute Idate said that the average spending per user is about 26.50 to 37.50 euros (US$34.80 to US$49.20) per month in industrialized countries, but this figure falls to about 8.20 euros in the newly targeted emerging countries.
But the network operators seem little concerned by the prospect of smaller budgets and a market characterized by pre-paid cards rather than subscriptions.
"India represents a fabulous opportunity for us," said the chief executive of Vodafone, Arun Sarin, at the 3GSM meeting.
His company agreed to pay US$11.1 billion last week for Indian operator Hutchinson Essar.
While China was the talk of Barcelona at the 3GSM conference here last year, India has stolen the show this year.
Sarin underlined the low levels of mobile phone use in India, his native country, where he said only 13 percent of the population owned a handset. This figure would rise to 40 percent in 2010, he added.
The Indian market currently includes 150 million subscribers, but 6.5 million to 7 million new users are added each month.
With an eye on the needs of emerging market consumers, Vodafone announced on Wednesday a deal with Chinese producer ZTE Corp (
ZTE is to manufacture a series of low-cost phones which will be sold under the Vodafone brand name from the second quarter of this year in emerging countries.
US manufacturer Motorola won the GSM Association award for best ultra low-cost phone this week with its "Motofone" model, a sub-US$30 handset for the developing world.
"Our market research showed that in India consumers wanted a phone both cheap and aspirational in design," said Andrew Morrow, European product line manager for Motorola.
The phone is sleekly designed, but is robustly made and has a special screen that is visible in direct sunlight.
"It's an investment in the future," Morrow said. "As the market grows, they buy more and more expensive phones."
In South Africa, Motorola sold only basic mobile phones four years ago, but now 50 percent of sales are for more sophisticated models.
Analysts stressed that developing markets are extremely profitable for the companies that dare to go there.
"The average revenue per user is very low, but operators don't have a lot of commercial expenses so their margins are huge, between 35 percent and 50 percent," said Emir Halilovic, an analyst at research group IDC.
COMBINING FORCES: The 66th Marine Brigade would support the 202nd Military Police Command in its defense of Taipei against ‘decapitation strikes,’ a source said The Marine Corps has deployed more than 100 soldiers and officers of the 66th Marine Brigade to Taipei International Airport (Songshan airport) as part of an effort to bolster defenses around the capital, a source with knowledge of the matter said yesterday. Two weeks ago, a military source said that the Ministry of National Defense ordered the Marine Corps to increase soldier deployments in the Taipei area. The 66th Marine Brigade has been tasked with protecting key areas in Taipei, with the 202nd Military Police Command also continuing to defend the capital. That came after a 2017 decision by the ministry to station
‘INVESTMENT’: Rubio and Arevalo said they discussed the value of democracy, and Rubio thanked the president for Guatemala’s strong diplomatic relationship with Taiwan Guatemalan President Bernardo Arevalo met with US Secretary of State Marco Rubio in Guatemala City on Wednesday where they signed a deal for Guatemala to accept migrants deported from the US, while Rubio commended Guatemala for its support for Taiwan and said the US would do all it can to facilitate greater Taiwanese investment in Guatemala. Under the migrant agreement announced by Arevalo, the deportees would be returned to their home countries at US expense. It is the second deportation deal that Rubio has reached during a Central America trip that has been focused mainly on immigration. Arevalo said his
‘SOVEREIGN AI’: As of Nov. 19 last year, Taiwan was globally ranked No. 11 for having computing power of 103 petaflops. The governments wants to achieve 1,200 by 2029 The government would intensify efforts to bolster its “Sovereign Artificial Intelligence [AI]” program by setting a goal of elevating the nation’s collective computing power in the public and private sectors to 1,200 peta floating points per second (petaflops) by 2029, the Executive Yuan said yesterday. The goal was set to fulfill President William Lai’s (賴清德) vision of turning Taiwan into an “AI island.” Sovereign AI refers to a nation’s capabilities to produce AI using its own infrastructure, data, workforce and business networks. One petaflop allows 1 trillion calculations per second. As of Nov. 19 last year, Taiwan was globally ranked No. 11 for
Israel yesterday said it has begun preparations for the departure of large numbers of Palestinians from the Gaza Strip in line with US President Donald Trump’s plan for the territory, while Egypt has launched a diplomatic blitz behind the scenes to try and head off the plan. The Trump administration has already dialed back aspects of the proposal after it was widely rejected internationally, saying the relocation of Palestinians would be temporary. US officials have provided few details about how or when the plan would be carried out. Trump yesterday said that Israel would turn Gaza over to the US after the