You don’t need a smartphone, but it sure does make life easier. And if you’re going to buy one, you’re probably buying the best one money can buy, right?
If you’re American, you’re probably buying the most expensive smartphone available. Screen size, battery capacity, and display resolution are all important features, but that hasn’t stopped the iPhone from becoming the most popular smartphone in the United States. Despite being more expensive and having weaker specs than a lot of the competition, Apple is selling a lot of smartphones and making a huge profit.
Even though the iPhone is outselling every other smartphone in America, there may soon be some very competitively priced competition. It just won’t be from whom you expect and the phones will be priced exactly what they are worth.
Expensive Smartphones are Cheap to Make
Apple sold 4 million units of the iPhone 6 within the first 24 hours it went on sale last week. When you consider the average price of the device is $799, it’s easy to see how Apple has managed to become so successful. People are willing to spend a lot of money on their smartphones and Apple has been capitalizing on this fact for many years.
It only costs a couple hundred dollars to manufacture an iPhone, but Apple is able to charge up to four times as much and reap an enormous profit. And because they have Apple Store locations all across the country, no other retailer makes more money per square foot than Apple.
Call it a clever marketing ploy, but Apple knows how to sell smartphones and they do it extremely well.
Apple isn’t the only company that sells expensive smartphones. Samsung, Motorola, LG, and others also sell devices for hundreds of dollars above what it costs to make. While some people consider this to be a form of price gouging, it’s simply the price consumers are willing to pay – especially Americans.
But there’s a movement going on around the world where people are spending less money for equal (or even better) smartphones than we have here in America. And the movement is slowly spreading onto our home turf.
The Rise of the Budget Smartphone
As Americans are waiting in long lines and spending thousands of dollars to buy an iPhone 6 before anyone else, Google has quietly released a line of budget smartphones catered to emerging markets. The specs may not be as impressive as the iPhone 6’s, but for $105 they are a steal.
Android One Specs
- 1.3GHZ Quad Core MediaTek Processor
- 4.5-inch Screen
- 1GB of RAM
- microSD Expandable Storage
- 5MP Main Camera
- 2MP Front Camera
- Dual-SIM Slots
- FM Radio
- 1700mAh Battery
- Android KitKat 4.4
The Android One is not supposed to be high-end, and its price reflects that.
The Android One is not a high-end device, but that’s exactly the point. The philosophy behind this smartphone is to make mobile technology available to people who otherwise couldn’t afford it. The specs may not be up to par with an iPhone 6, but the price reflects that – unlike most high-end devices that have even higher price markups.
With Android One sales in India estimated to reach 2 million before the end of the year, it’s safe to say this budget smartphone will be a success. There’s also a valid reason why the Android One won’t be available here in America: We want more.
Enter ZTE.
ZTE is a Chinese telecommunications company you may have never heard of, but the company is the seventh-biggest smartphone maker in the world. Their affordable devices are among the most popular in China – even outselling the iPhone – and ZTE has set their sights on the USA as a new territory to conquer.
With supersized smartphones rapidly increasing in popularity, ZTE sees this as a prime opportunity to offer Americans a phablet at an affordable price. But the new ZMAX isn’t just a budget-friendly device; it’s a high-end smartphone that may convince consumers they don’t need to spend a lot of money.
ZTE ZMAX Specs
- 1.2GHz Quad Core MSM8926 Processor
- 5.7” Gorilla Glass Screen with 1280×720 Resolution
- 2GB of RAM + 16GB ROM
- microSD Expandable up to 32GB
- 8MP Main Camera
- 1.6MP Front Camera
- LTE Connectivity
- 3400mAh Battery
- Android KitKat 4.4
This ZTE ZMAX has high-end specs and a low-end price. Will consumers buy it instead of an iPhone 6?
ZTE’s business plan is to create “affordable premium” devices and the ZMAX is an excellent reflection of that. With a retail price of $252 without a service contract, shoppers will be able to purchase a high-end phone at a low-end price.
Will Americans Catch On?
To convince consumers who spend a lot of money on smartphones to buy something “cheap” won’t be easy — especially if they’ve never heard of the brand. This is why ZTE has decided to invest a lot of money into a new marketing campaign they predict will double their US market share within three years.
It’s unlikely the ZMAX will outsell the iPhone, but it could change the mobile technology industry. Because smartphone prices have been falling while phablet sales keep increasing, ZTE could potentially drive those prices even lower.
But that’s only if it sells.
The ZMAX will be available exclusively through T-Mobile who has also been trying to change the mobile landscape in America. By offering unlimited data plans, no contracts, and early termination buyouts; ZTE and T-Mobile seem poised to convince people a phone should only cost what it is worth and not what people are willing to pay for it.
Do you think budget premium smartphones can succeed in the USA? Or will Americans stick to their expensive iPhones? Let us know in the comments below.
