Last week New York Magazine published an article,
"We’re No Longer in Smartphone Plateau. We’re in the Smartphone Decline." which highlighted several points:
1) Global "Smartphone Plateau" occurred from 2015-2017
2) Sales in 2017 declined slightly from 2016
3) Most analysts believe annual global demand will decline from 2017 levels
4) Mid-priced phones have almost disappeared. In 2017 in the US, 43% of phones sold cost more than $600, and 40% cost less than $200, with approx. 15% costing between $200 and $600.
5) All the gimmicks we're seeing from the $600+ phones are a desperate attempt to delay commodification
6) As happened to TVs, these gimmicks are probably appearing faster than consumers can understand or care about
7) Most phones are more powerful than the average user needs them to be
8) As advancement in phones slows and phones become commoditized, people won't replace them as often.
There nothing really surprising or controversial in the article. But I think it highlights why Blackberry Mobile has not, and will not, try to produce a phone to compete with Apple and Samsung's flagship products. There's more open space in $600-650 "bottom" tier of the premium market (where the KEY2 is priced) and the mid-tier (where the KEY2 LE is priced) for a phone that is better differentiated from the generic slabs, and feels "premium enough" for people who don't want to spend more.
Will their strategy work? I have no idea, but it seems pretty clear what it is.
The good news, according to the author, as phones become commoditized, "Behind the scenes there may be a bloodbath, but you’ll simply notice that you’re getting a lot more phone for a lot less money.
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