Impact of Low-cost Smartphones in Low ARPU Markets
2015.12.30   |   43 pages   |   Customer Experience and Connection

Author:
Patrizia Balia


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Mobile network operators in developing markets face significant potential loss of revenues as low-cost smartphones enable users to switch to OTT services rather than paying for traditional voice and SMS offers. 

There is demonstrated upside potential in the migration however, and operators that get ahead of the curve and lead their customer base towards cost-effective smartphone-based connectivity can expect increased revenues as a result.

  • To achieve the increased revenues, network deployments and tariff structures must support the requirements of the data traffic.

This report examines approaches to delivering smartphone capability affordably in developing markets and the benefits that have resulted.  It concludes with recommendations for MNOs that wish to lead the disruption rather than be damaged by it.

 

 

Companies: Samsung, Apple, Huawei, Xiaomi, Lenovo, Motorola, Microsoft, Nokia, Cherry Mobile, Lava, Coolpad, Karbonn, Zest, Mint, Dream Mobile, VMK, Nerve Mobile, Jolla, Kazam, Flipkart, eBay, Green Alliance, Ericsson, T-Mobile, Verizon, AT&T, Safaricom, Vodafone, Vodacom, MTN, Etisalat, Jumia, Orange, Turkcell, Google, Vestel Electronics, Avea, ZTE, Firefox, Facebook, Whatsapp, WeChat, Line, TRAI, Globe, Smart, Spotify, KakaoTalk

Countries: UK, USA, Kenya, India, Nigeria, South Africa, Turkey, Malaysia, Philippines, Madagascar, Bangladesh, Sri Lanka, Nepal, Argentina,

Keywords: Android, developing markets, OTT, MeeGo, mobile OS, refurbishment, E-commerce, Android One, migration, insurance, data traffic, loyalty program, Windows Phone, loans, low-cost, second-hand, Sailfish, Subsidies, OEMs, channels, penetration, affordable smartphones, Instalments, Tizen, Circular economy,

1

Overview

1

2

Introduction

2

2.1

Background to the Report

2

2.2

Report Content

2

2.3

Currency and Conversions

3

2.4

Further Questions and Feedback

3

3

Smartphone Trends

4

3.1

Market Overview

4

3.2

Availability of Low-cost Smartphones

5

3.2.1

Low-cost Smartphones From Traditional Vendors

5

3.2.2

Chinese and Other Emerging Smartphone Vendors

6

3.3

Smartphone Channel Evolution

9

3.3.1

MNOs’ Retail Channels

9

3.3.2

Smartphone Vendors’ Direct Sales

10

3.3.3

E-commerce Sales

10

3.3.4

Moves Towards a Circular Economy

10

3.4

Smartphone Adoption Impact on Data Volume

13

4

Encouraging Migration to Smartphones

15

4.1

Introduction

15

4.2

Smartphone Finance Plans

15

4.2.1

Rationale for Plans

15

4.2.2

Safaricom’s Smartphone Offers to Extend Penetration

17

4.2.3

Etisalat Nigeria Device Financing

20

4.2.4

Vodacom Device Financing and Insurance

23

4.3

Trade-in and Refurbished Device Schemes

27

4.4

MNO Branded Smartphones

30

4.4.1

MTN and Vodacom in South Africa

30

4.4.2

Operator Branded Smartphones in Turkey

32

4.4.3

Orange Smartphones in Africa and the Middle East

34

4.5

OS and OTT Service Provider Collaborations

35

4.5.1

The Android One Program

35

4.5.2

Free Basics by Facebook

36

4.5.3

Apps & Innovation Driving Smartphones in the Philippines

37

5

Conclusions & Recommendations

41

5.1

Conclusions

41

5.2

Recommendations

42

 

Appendix – Feedback Questions

44

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Mobile Market Development 2015