The “emerging market” handset trap
Today at Mobile World Congress, Vodafone announced “the world’s cheapest phone”. At $15 it certainly scores low on the price tag – which is good – but it also scores low on functionality – not so good. Not only is this a problem for any end user who might need (or want) to use it for things beyond voice calling and SMS, but it’s also perpetuating a long-standing problem in the social mobile world dating back over five years.
With the ICT4D community putting an increasing focus on “smarter phones” – ones which feature downloadable applications and allow for cloud-based solutions, for example – where do phones like today’s Vodafone 150 fit in? Aimed specifically at emerging markets, these are the kinds of phones Vodafone are hoping will end up in the hands of the very patients or farmers the ICT4D world is itself working hard to reach.
Low-cost phones have certainly achieved one thing – low cost – and in price terms they’ve done exactly what they said on the tin. Over the past five years or so, prices have indeed steadily dropped, as we can see if we pick an early “emerging market handset” winner from 2005 (the Motorola C113), a ZTE phone widely available in East Africa in 2008, and today’s Vodafone 150.
The prices may have changed, but functionality has largely stagnated. You couldn’t browse the web on the Motorola in 2005, nor the ZTE in 2008, and today you’d have the same problem on the Vodafone 150. You can’t download applications onto any of them, either. They all have monochrome screens and look pretty-much-the-same despite having a five year gap between them. Very little has changed other than price, it would seem. Voice and SMS remain king at the bottom of the pyramid, or so it would seem.
The real trick is to reduce the price of these phones whilst at the same time increasing (or at very least maintaining) functionality, a combination which no manufacturer has yet managed to crack. Nokia’s announcement last week of their cheapest 3G-enabled phone for the Indian market shows prices are shifting downward for data enabled phones, but at $90 it’s still some way off what most would consider affordable for the remaining 1.5 billion people in the world without a phone.
From today’s announcement, a sub-$40 smart phone – which really would change the game – looks to be as far off as ever.
[Related post: "The Digital Divider"]