Skip Links

Price versus brand takes focus in the battle for smartphone supremacy

Established vendors will have a tough year as they try to keep Chinese vendors at bay

By Mikael Rickna$?s, IDG News Service
March 02, 2012 11:10 AM ET

IDG News Service - Established vendors such as HTC, Sony and LG Electronics want to set their smartphones apart from less expensive devices from ZTE and Huawei. But as looks and hardware specifications are becoming more similar and software differentiation harder, having a better reputation is their last ace, according to analysts.

Mobile World Congress 2012, which ended Thursday, lacked really big announcements, but offered a plethora of new smartphones in all price ranges. Before the show, Geoff Blaber, an analyst at CCS Insight, said HTC and LG Electronics needed to do a major refresh of their respective portfolio of smartphones, and that they did.

MOBILE WORLD CONGRESS: Hottest gadgets from 2012 show | Video highlights

"HTC had a good show and the One X is a very, very strong device, and LG has done as well as anyone expected," Blaber said on the last day of the event.

But those vendors along with Sony and Motorola Mobility are facing the same problem as before the show. They are being squeezed on one side by Apple and Samsung Electronics' growing market shares and on the other side by Huawei's and ZTE's low pricing, according to Blaber.

The Chinese vendors have a clear strategy, according to Francisco Jeronimo, research manager at IDC.

"They are trying to make their products as similar as possible to ones from established vendors and hope the consumers will go for their cheaper smartphone," said Jeronimo.

The quality of Huawei's phones has improved a lot over the last couple of years, although ZTE's products still lag behind Huawei in that regard, Blaber said.

The established vendors don't want to compete on price with Huawei and ZTE, so they need to set their products apart, but doing either via software or hardware is increasingly difficult, according to Carolina Milanesi, research vice president at Gartner.

"There isn't much I have seen that would drive me from one vendor to the next," she said.

On the hardware side, the focus at this year's show was very much on processors, especially quad-core, according to Jeronimo.

"It is a race and something that makes headlines," said Jeronimo, who doesn't think the addition of two more cores will make much of a difference to users, since there aren't many applications that can take advantage of them.

But while LG and HTC are releasing smartphones with quad-core smartphones and big screens, so are Huawei and ZTE.

And HTC is getting kudos for its deal with Dropbox, which will integrate cloud storage service on smartphones.

"It is reassuring that HTC is not starting from scratch and trying build their own service," said Blaber.

HTC also launched Media Link, which allows users to integrate their smartphones with their TVs.

"It is kind of important, because HTC doesn't have a TV business and everyone is talking about integrating multiple screens," said Milanesi.

But turning that accessory into an advantage when a user is standing in a store choosing their next device will be a challenge for the company, according to Milanesi.

Our Commenting Policies
Latest News
rssRss Feed
View more Latest News