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December 13, 2012

Sales of Prepaid Smartphones will Surpass High-End Devices by 2017

Informa Telecoms and Media, a provider of business-critical research, training and events, reported that sale of prepaid smartphones are expected to surpass high -end devices by the end of 2017. Last year, the high- end smartphones, which are priced at $200 or more, made up a sales figure of more than 83 percent of the market, according to Informa. However, the market share is anticipated to drop to 33 percent by the end of 2017. At the same time, the research firm forecasts that by the year 2017, affordable or prepaid smartphones, those priced below $150 with no contract, will grab a majority of the shares.

With the emergence of smartphones and advanced mobile computing technologies, the demand for such smart devices has grown significantly over the last few years. With this increasing trend, manufacturers are introducing the latest components and advanced technologies to enhance user experience and satisfaction. At the same time, the price of smartphone devices is also increasing in tandem. While the high -end, feature-rich smartphones are still a delight for many well-heeled mobile buffs, it is expected that the market share for such devices will drop significantly by 2017. 

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The current market is slowly shifting to prepaid affordable smartphones, available at price of $150 or below, and stuffed with world class features and advanced technology systems. It is expected that the future mobile market will be split between cheaper prepaid devices and high -end smartphones that are heavily subsidized by the wireless carriers. However, a shift in the mobile industry is a bad news for high -end smartphone manufacturers, since they can expect only a small profit margin with the price of mobile phones dropping significantly. The advent and popularity of other smart Web-enabled devices, like tablets, is also expected to catch a share of the market for high- end smartphones

With the changing industry, low-cost and prepaid carriers like Virgin Mobile, Straight Talk, MetroPCS, and others are expected to see rapid growth in the years to come. In this context, Informa analyst, Malik Saadi said that as the mobile market will develop, the supply chain will be split increasingly into two camps; the first being the innovators, who will introduce high performance components and new features to the ever-growing mobile marketplace, and the second being the followers, who will leverage these innovations to grab the market at competitive prices in the coming years.

With this, Malik Saadi actually pointed to the high- end smartphone manufacturers, followed by low-cost prepaid carriers who have the advantage to offer the latest technologies at cheaper prices to the customers because there is less spending on innovations.

Edited by Brooke Neuman

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