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Smartphones, the boom of sales is postponed?!

On pages of usual editions even more often it is possible to find the information about smartphones, these devices in eyes of inhabitants symbolize technical progress, and flight of engineering idea. The more often there are mentions in usual newspapers and magazines, the greater interest to devices IT-managers start to show, and this interest is twofold. Someone wants to get smartphone for himself and to use it instead of a sheaf of a handheld computer and phone, someone seriously examines an opportunity to expand assortment of the company due to such devices. For gravity in this question there are all bases, in fact the mistake can turn back the goods stale and the money spent. On the other hand, the specialized press dazzles victorious reports, narrating about successes in sales of smartphones in the markets of the Western Europe. How here not to become thoughtfull and not decide to try the forces in this area?! The given material is intended for those who make a decision on the nomenclature of the goods and promotion of this or that type of devices on the market. If you need smartphone for the needs, you can find lots of articles on this topic as in usual, and network editions, the same material is hardly useful to you.

Before starting detailed consideration of a topic, let's agree, what devices refer to smartphones. In developed terminology the term smartphone designates the device which is not having the keyboard. If it is present it is necessary to name the device communicator and in no way differently. Frequently these two terms confuse, mixing concepts. Really, on carried out functions, both smartphones, and communicators are rather close, differs only in a way of input of the information, and the sizes of devices and their positioning.

By the way, some interesting conclusions, not obvious at first sight, follow from positioning of devices. So, communicators are positioned as high-grade replacement of the desktop personal computer, and also laptop on short trips where it is necessary to answer quickly small letters, to have at hand some working files. Well and, certainly, communicators provide you with connection with the external world, in addition guaranteeing sending and reception of mail, site-viewing. Since recent time in some countries service of batch transfer (GPRS) became accessible in roaming, that has lowered cost of use of devices on their direct purpose. Outside of trips the use of communicators is unjustified, at their too big weight and small operating time from one charge. That is, as a matter of fact, communicator is replacement of laptop on short-term trip. Certainly, there is a set of users who use communicator constantly, but in this case on the foreground goes the question of functionality, and desire to emphasize the status. That is interesting, such desire moves not only our compatriots, but also silent quiet Finns. My friend, who works as a usual engineer in Turku, as a second phone has purchased communicator though neither business trips, nor needs for such device for him are not present, it is a craze. Hanover exhibition CEBIT can act as the other indicative example. Being sent in the morning by a tram to the expocentre, will bondage you to meet up to ten persons lovely stirring on communicators in this carriage (mainly Nokia 9210). Later with some of them it was possible to be thrown by pair words, and I always asked about, whether their basic tool of dialogue is communicator. In most cases people answered, that this tool of dialogue on trips, an ideal replacement for laptop. An Italian, who was of average years, by name Mario was remembered to me. He has told me, patting on my shoulder: " I'm not a journalist, it is not necessary for me to tap on keys days without a break, enough to put the signature and all. And this toy weighs practically nothing, you would look at a suitcase from my old laptop, it weighed kilograms ". As confirmation of such sight, figures of communicators sales can serve, basically they are devices from Nokia - Nokia 9210 and appeared later 9210i. In first three months after the beginning of sales, Nokia 9210 has exceeded on a sales volume in the Western Europe of a handheld computer from Palm. A quite good parameter for devices which cost much more, rather than top models of a handheld computer for that moment. But it is literally for half-year of sale new communicators steel not so big, the agiotage slept. How to explain so sharp change of market conditions?!

Probably it is necessary to search for an explanation in the one who purchased these devices in the beginning and who became their consumers then. At the moment of coming out, the price of Nokia 9210 exceeded 1000 dollars, this solution was rather expensive, but claimed for top managers of the companies, exactly they became the first users of communicators. The ask price in this case did not play a role, functionality of the device which practically was always purchased for real usage was important. Realized demand has been very fast satisfied, as in the world top managers are not uncountable. The followed reduction of prices has enabled to purchase the device to those consumers, who are sensitive to an ask price. However, increases in sales thus have not followed, they become to fall gradually, until were not recorded yet at the certain level. All this allows to say that communicators are extreme recess solution, their price is too high and the usage is narrow. In fact, it's senselessly to carry every day from home to work the device, that weighs 250 gram. In both places there are valuable PCs, it is more convenient to type the text, to look a mail, to esteem news on various sites on them. And a necessity of additional daily charge also does not involve. You can have the other question. Why communicators are inapplicable in durable trips?! They are quite applicable, all trouble is that the task force on which they are directed, does not leave for weeks, all trips are limited to two three days. All listed reasons show, why there are only some models of communicators in the market now, and 90 percents from them belong to Nokia company. It has only filled in a niche empty up to it.

The story about communicators was important and necessary for understanding a place of smartphones in the today's market. They have doubtless advantages, as before communicators, and usual phones. This and functionality similar to a handheld computer, and many smartphones work under steering of the operating systems used in a handheld computer that makes their compatible with already written software. The big color screens, sync of the data with the PC, the advanced directories, all this ennobles smartphones above usual phones. Minuses of such devices are obvious, they, as a matter of fact, same as for communicators, it's concerning the big weight, a small operating time in comparison with usual phones, but they are expiated by the greater functionality and strangely enough the price. Let's take for matching the most popular smartphones, working under Symbian steering, it is Nokia 7650 and we'll look statistics.

According to the research of company Canalys, market EMEA in the field of a handheld computer and smartphones in the third quarter 2003 was doubled in comparison with the similar period of the last year. By quantity of the sold devices Nokia company is in the lead, on its share falls 56 percent of sales, on the second place is Palm, 15 percent. For the first time after 4 quarters with inert sales the market has grown, has been sold 1.2 million devices, on this parameter it is the best quarter for all the time. The big contribution to sales was brought with model Nokia 7650. The share of Symbian devices for the first time has reached 57 percent. According to the director and the main thing Canalys analytics Chris Jones: “We observed increase the share of Symbian earlier, when Nokia 9210 has got in shops one year ago. It is typical enough at occurrence of a new product, but frequently the first success is supported with nothing. In a case with Nokia 7650 situation is a little bit other, we have more positive response at present from channels of distribution”. Also plays a role, that, this product is focused on wider audience, rather than Nokia 9210. Success of Nokia 7650 has been supported with the wide advertising campaign from Nokia. Plus the operators, despaired to convince subscribers of advantages of MMS-messages, subsidized sales of this smartphone to make its accessible to the greater audience.

Here we also open the most interesting, operators subsidize Nokia 7650, hoping to receive feedback on the services concerned with data transmission. On the average the size of grants for this model reaches up to 200-250 Euros that has reduced the price for the device up to 400-450 Euros. At purchase of the certain contracts the price can fall even more. The positive balance of sales is based on subsidizing, operators involuntarily displace smartphones in other price category, opening for them new users. Thus, due to the grants, the given concrete product is rather not bad sold in the market. Now we'll look at the situation on the part of the analysts predicting sharp growth of smpartphones sales and necessity already now for retail sellers to have them available. Similar forecasts are under construction on the assumption, that the market of a handheld computer is similar to those for smartphones. The such statement, to put it mildly, is incorrect.

If the attempt of manufacturers of a handheld computer to offer cheap devices in cost from 100 up to 200 dollars is now observed, they are connected with two principal causes. On the one hand the cheap, budgetary solution is always consumed in plenties in the market, that enables to receive profit on volumes. On the other hand, manufacturers of a handheld computer already now should think about the future, in fact they cannot subsidize sales of the devices, in this case, they obviously lose race to manufacturers of smartphones. Having looked on the plan of an output of smartphones, we'll see, that in the 4 quarter 2003 in the market, the majority on Symbian OS, will be submitted about 20 devices. Such big modelling line even similar functionally devices will make a real competition to a traditional handheld computer, for this reason the next year handheld computer, as such will not be, all new devices to some extent support GSM-networks. Last announcements of new devices precisely specify this tendency, the handheld computer start to receive the built - in GSM/GPRS-modules, manufacturers prepare for war for the consumer. We come to the conclusion, that the market of a handheld computer differs from those for smartphones.

In fact at the sale of smartphone on the foreground there are its communication opportunities, and here all cards go in hands to operators and interiors of communication. Buyers are ready to get devices, and also connection from them or explanations about those. Attempt of a computer company to start sale of smartphones (not communicators, and smartphones) will not bring success, these goods require the other support, logic of its sales differs. Experience of sales of a personal computer or a handheld computer does not play a role for smartphones, not the final device, and smartphone and a set of additional services is sold here . At least, sellers should have strong contacts to operators which already now have good distributor networks, and both in Europe, and in Russia. It is interesting, that also the return rule operates here, about one year back large network of interiors of cellular communication in Moscow has decided to begin sales of a handheld computer. New names have appeared in price-lists, on a site of the company, but from more, than 10 positions, only one has been sold within a month. The project should be curtailed, as the structure of the buyer was other, sale of a handheld computer would demand the big advertising budgets, new people, as a matter of fact, construction of new business. For these reasons our cellular interiors also do not trade in a handheld computer, it is the other business.

It is not necessary to be under a delusion, that the computer companies can learn to sell smartphones during the moment, for this purpose it is necessary to begin with sales of usual phones, differently it will turn out nothing. And already then the buyer who will buy smartphone in your shop will come. While words that PC-business and smartphones sale are similar, are only words.

Published — 5 December 2002

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