The rise of the fall: Why mobile phone buyers should rejoice!
The sky is falling! If you’re into any form of pop culture, from comics and songs to literature, then the one thing you’ve been taught is that you should fear nothing other than the sky falling down. Fortunately, if you’re a mobile phone user and one that is ready to buy a new phone, that’s exactly what you should be celebrating. The sky seems to be falling out of the mobile phone pricing stratosphere. Things that have never happened before are happening at a ferocious pace. New phones are being launched at prices lower than the previous generation, companies that never discount are deep discounting, lower prices are being announced at regular intervals and prices are being reduced at a breathtaking pace almost every day. If you’ve just saved up to buy a new phone – you’re practically in heaven. But behind all this pricing hullabaloo is a story of great future impact. Time to tell the tale of the Rise of the Fall.
The brutal India market
India has always been one of the most brutal mobile retail markets in the world with China and Russia close behind. Predatory pricing, deep online discounting, loss-leading retail strategies, brand launches that use price to buy loyalty, insane retail margins to kill the competition – all of these are just the way the market has always been. But now what seems like a nut job strategy has taken on even more ominous proportions.
The first big surprise came with Apple dropping prices on the XR and XS phones that have been recently released. Not by small Appleish type numbers – but by seriously big fat reductions. This was a big surprise as Apple usually guards its price line harder than the security around Fort Knox. In fact the XR currently, with the use of the right credit card, is an unbelievable deal. Samsung responded right back and cut prices on the Samsung S10e. Once again, use the right cashback and credit card and you can get the S10e (an absolutely fantastic phone) at a price that will make you a very happy camper.
Samsung though has been super aggressive for a while now. Its M series of online phones as well as the new strategy of high-end specs and low-end aggressive prices on the A series has led to a windfall gain in market share. It’s got Xiaomi to blink on multiple occasions now, making it reduce prices on literally any and all phones that compete. Nokia offered a flat discount of Rs 6,000 on the 8.1 model. Vivo and Oppo also cut back prices on phones that were already selling well. It was bloodbath time. But then something else happened that shook up the market even further.
OnePlus launched its much awaited OnePlus 7. This is a company that started its business by calling itself a ‘Flagship Killer’. Thus great top-of-the-line specs at low prices. Its first phone, the OnePlus 1 came out at around Rs 21,999. But ever since it’s followed a simple trend of bumping up prices majorly with each new generation. It’s last phone, the OnePlus 6 came out at a staggering Rs 34,999, belying its flagship killer moniker.
And then came the OnePlus 7. At a reduced price of Rs 32,999. This was unheard of. A new generation of phones with excellent specs and features at a price lower than before? Yes, it also came out with another phone, the OnePlus 7 Pro at a ridiculous price of Rs 57,999 for the 12GB version – more on that in a future column. But it’s the bread and butter OP7 that has really set the cat amongst the pigeons.
So what’s going on here? What’s with this disruptive price and how does the world’s most brutal mobile phone market become even more brutal? Well, there is a reason. A big one!
India no. 1
Smartphone sales have slowed down in most parts of the world. Developed markets don’t have new smartphone converts, people aren’t turning around their phones as quickly, mobile tech has made most phones last great for two years and there just isn’t much demand now. There are still pockets left in the world where there is demand for smartphones but these are smaller countries. Other than, of course, the behemoth market – India. We are still growing, we still have great demand and we still have a huge population that will switch from feature to smartphone. Apple needs us as they want to start retailing and manufacturing big here. Samsung needs to wrestle back to No. 1. Xiaomi needs to hold on to its big gains. All the others need to consolidate and generate huge numbers. This brutal aggression, though, does hammer in the final nail into the coffin of Indian brands. They just can’t compete anymore!
Rajiv Makhni is managing editor, Technology, NDTV, and the anchor of Gadget Guru, Cell Guru and Newsnet 3
Techilicious appears every fortnight
From HT Brunch, May 26, 2019
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