Low-cost smartphones to account for 46% of market by 2018

April 22, 2013
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Sony Xperia Z vs Google Nexus 4 aa (25)

Sure, everyone would like to own the latest and greatest Android handset – Samsung Galaxy S4 or HTC One are such examples – but many buyers choose instead a budget smartphone or even a feature phone. While budget smartphones account for 28% of the market right now, ABI Research says low-cost smartphone market share is in for a reasonable rise, to 46% of the market by 2018.

Low-cost smartphone shipments are set to grow from 259 million in 2013 to 788 million in 2018. ABI Research identifies a low-cost smartphone to be priced under $250, a mid-range device to cost sub $400 and a high-end device is constituted as anywhere above.

So what does this all mean? Well it could mean two things. For one, people have usually had to pay a premium to get a smooth device with decent specifications. But now as handsets become better and more powerful, we are able to buy devices which suit our needs for less money.

Take the Nexus 4, at $300 it would be labeled a mid-range phone, but I don’t think anyone would call it a mid-range device. Some people have come to the conclusion that the specifications on the Galaxy S4 or the HTC One would be wasted on them and as technology progresses, who knows what $250 will get you.

Another factor that could play a part in the blossoming of the low-end market, is the updraft of people moving away from feature phones. Senior analyst Michael Morgan says:

As the feature phone segment continues to lose its battle for relevance, the low-cost smartphone has become the tool for operators seeking to drive increased data revenues.

Although Android is inching towards the one billion activations mark, there still seems to be a great deal of leg room for growth, which is great news for Google. This doesn’t mean high-end smartphones will cease to be relevant, as they will continue to play an important role for carriers looking to upgrade their network and bleeding edge technology fans, who will want to have the greatest experience from a smart mobile device.

In fact, the same study reveals that mid-range and high-end handset shipments will also grow in the coming years, from 635 million in 2013 to 925 million in 2018.

Will you be looking to pick up a cheaper smartphone than your last? Raw octa-core power just not a necessity for you? Let us know in the comments.

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