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.

Comments

  • dogulas

    Just barely bought a GS3 with this mindset. Huge discount from a year ago and still a fantastic phone. Don’t need the latest and greatest. Just a very community-supported phone that has proven itself.

  • SamsungSteve

    I would Love to get the new Samsung galaxy S4. The only thing holding me back is the potential for what the Note 3 might be offering. High end smartphones are the only way to go(in my opinion.) Unfortunately my GSII is loosing it’s luster, but still a great phone. if the Note 3 comes this year with Exynos Octa, LTE, and Sammy’s new flexible OLED… it’s gunna be real hard not to go all in with that.

  • Jusphe

    Same was writer about netbooks a few yeras ago……

    • Adam Koueider

      Difference is they were really slow, buggy and had horrible battery life. I’d like to think the Nexus 4 is neither of those.

  • blarelli

    Inexpensive smartphones were absolute crap two years ago. Now though, you can actually get a very impressive device for $200. I know I’ll get yelled at for mentioning it here, but you can get a fantastic nokia windows phone for under $200 unlocked.

    If a phone has a reasonable quality screen, enough ram, a decent web browsing experience, and enough memory to store my music, I don’t see any reason why I wouldn’t settle for something less than the latest and greatest.