GSM Association advocates cell phones for 30 dollars, manufacturers have no intension to follow up
Date: 2017/06/08
Recently, GSM Association declared that in order to spur on the development of GSM in such Third World Countries as China, India and African countries, GSM will encourage its members to release cell phones for under 30 dollars （about 448 yuan）, which should be marketed before the first half of 2006. However, feedback information from cell phone manufacturers and sales fields show that low priced cell phones likely to cause a situation of earning at a loss. Therefore, many manufacturers have no intension to follow up.
Motorola indicates that low priced cell phones for 40 dollars will be marketed soon and will be mass sold in China by the end of the year at the latest. Currently, the lowest price of cell phones marketed in the market of China is 66 dollars. Cell phones for 40 dollars are likely sold to telecom operators in China. Nokia indicates that competitive products will be marketed in China in the third or fourth quarter of the year. Nokia states clearly that the company will cooperate with China Unicom for the first time to release low priced CDMA cell phones of entry level. Siemens said not long ago that it will release a series of low priced cell phones for about 30 dollars within the year. The lowest price of Siemens cell phone fell to 199 yuan (24 dollars). The explanation of this situation was that Siemens was conducting the structural adjustment and reducing the great amount of inventory. As the mobile business of Siemens was purchased by BenQ, there are still many uncertain factors existing in low price strategy.
Xu Lihua, Chairman of Bodao Technologies said that the basic five functions of cell phone are calling, SMS, address book, message registration, and caller ID. Without these five features, no matter how cheap the cell phone is, it will not last long. Cell phone with such configuration will not be sold at a low price. Both Yang Huaibo, vice executive chairman of Sony Ericsson and chairman of its branch company in China, and Gunilla, global vice president and the head of Great China Region of Sony Ericsson indicated that cell phones too cheap will loss technology features and Sony Ericsson won’t participate in the competition of cell phones at a price lower than 1,000 yuan. Li Kunyao, chairman of BenQ stated that profit gained field from low priced cell phone is too small to support a sustainable development. After taking over Siemens, BenQ will focus on solving the problem of lacking of high-end products. (New Bulletin)
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