Software solutions take high quality features to emerging markets
A whole new range of low- and mid-market smartphones are stealing market share from the established leaders. In this article you’ll read how companies like Huawei, Xiaomi, ZTE and Lenovo are set to strongly increase their footprint in terms of volume … and how NXP Software’s LifeVibes VoiceExperience solution is delivering top-end audio performance on a new breed of low-cost handsets.
But first, where is the smartphone market heading? Océane Dorange, Market Intelligence Manager at NXP Software, predicts significant growth in the overall smartphone sector. “By 2016,” Dorange says, “we estimate that 80% of all phones shipped will be in the smartphone category. And more than half of total global handset sales will be in the emerging low- to mid-end smartphone niche.”
The low- and mid-tier smartphone sector is poised for massive growth. Manufacturers are using all their skills to bring highly featured, sub-$300 and even sub-$150 models to market. That means they have to work hard reduce build costs and find ready-made software solutions as alternatives to more expensive hardware solutions.
Do trends in China predict global consumption?
For many industry analysts, the massive Chinese handset market provides useful figures for estimating global trends.
By the end of 2013 China had 700 million actives smartphones, according to TechCrunch and data from Umeng Analytics (link below). Of these 700 million smartphones, 35% were in the relatively new sub-$150 sector … and that’s a sector which is set to grow as aggressively-priced models make smartphones available to the masses.
As NXP Software’s Dorange points out: “In 2013 alone, almost a third of the world’s total consumption of smartphones were sold to Chinese customers By 2017 this will be more than 50%. Dorange expands on the figures to give a global view of smartphone sales. “In 2013, three companies who are pioneering competitively priced models – Huawei, Xiaomi and ZTE and Lenovo – sold 136 million smartphones, compared to 150 million from Apple. They’re catching up rapidly.”
Nicolas Sauvage, Sr. Director of Sales, picks up on that last point. “Companies like Huawei, Xiaomi and ZTE are launching exciting models that have price points which consumers could only have dreamed about a couple of years ago. These lower cost phones are set to disrupt the already-disrupted handset market.”
IDC. Low cost is the key difference maker.
In a press release, Ryan Reith, Program Director with IDC’s Worldwide Quarterly Mobile Phone Tracker, threw some light on his company’s research: “Among the top trends driving smartphone growth are large screen devices and low cost,” said Reith, “Of the two, I have to say that low cost is the key difference maker. Cheap devices are not the attractive segment that normally grabs headlines, but IDC data shows this is the portion of the market that is driving volume. Markets like China and India are quickly moving toward a point where sub-$150 smartphones are the majority of shipments, bringing a solid computing experience to the hands of many.”
It’s a view that Sauvage shares. “Volume growth of sales in the low- and mid-end smartphone segment will be driven by the replacement of feature phones in emerging markets and novel applications that improve real life experiences like recently taxi booking in China. This sector is where our LifeVibes VoiceExperience solution makes a big difference. Getting the maximum voice performance out of lower-cost chipsets, delivering wide-band voice quality over narrow-band infrastructures, and features like horn suppression all help these aggressively priced phones to compete.”
Dorange chips in: “Companies creating innovative low- and mid-tier smartphones are in various stages of evaluating or implementing our VoiceExperience solution. This will lead to a new generation of models that are affordable and have a high specification thanks to the democratization of innovation.”
Imagine the effect that mass access to low-cost smartphones could have for people in developing economies all over the world. For example, rural inhabitants could enjoy outstanding voice quality over narrow-band networks. Also, mobile calling could help rickshaw drivers to win more business. In such markets, horn suppression software can be really valuable for them. But of course there’s more to life than work. Imagine the Brazilian soccer fans using their smartphones to share their lifetime experience from a cheering football stadium at World Cup 2014.
As NXP Software, we’re excited to be part of this global revolution.
Pages referred to in this post:
TechCrunch: China has 700 million smartphone users.
IDC. Worldwide smartphone sales exceed 1 billion.