Feature Article

October 22, 2012

Low-Cost Smartphone Shipments Expected to Consistently Double

The smartphone market shows some absolutely spectacular growth numbers, and from the iPhone 5 on down to the wide array of lower-end models available, it looks like there are no signs of it stopping anytime soon. In fact, the results of a recent survey staged by NPD DisplaySearch suggests that not only are there no signs of a slowdown, but for the low-cost smartphone segment, shipments doubled for the past couple of years – and will be doubling for some time to follow.

The NPD DisplaySearch survey in question – Smartphones: Displays, Designs and Functionality – focused on the low-cost smartphone segment, or smartphones selling for less that $150 apiece. The report featured the conclusion that not only had the rate of shipments doubled between 2010 and 2011, as well as from 2011 to 2012, but would likely continue to double every year until 2016, going up from $4.5 million in 2010 to a staggering $311 million by 2016.

What’s ultimately driving this impressive growth in the low-cost smartphone segment is the growing proportion of smartphone users around the world, most of whom can't afford to spend over $200 for a smartphone, even before the cost of a plan comes into play. By bringing low-cost smartphones into the game, mobile providers get a new way to access the markets that might have otherwise gone without service, and in turn, access to the revenue that they represent. The biggest surge in growth in the low-priced smartphone market is found in the Asia-Pacific region, accounting for about 60 percent of the overall demand.

The primary requirement for a low-cost smartphone is that the components as well be low-cost. While this requires some corners be cut--the replacement of LTPS technology in displays with a-Si TFT LCD, for example--it also commonly calls for the use of inexpensive, mature technologies that may not be state of the art, but are serviceable enough to do the job.

Of course, this introduces something of an odd dichotomy into the works between "first world" telephones and "third world" telephones, but still, considering that the other choice was "nothing", it's good to see that at least some phones are making it into everyone's hands.

It's equally apparent that the drive to get one of these phones, even at the lower capability, is going to drive a lot of purchasing decisions for some time to come.

Edited by Allison Boccamazzo

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