Competition in smartphone market getting fiercer

Competition in smartphone market getting fiercer

Burhanuddin Abe, Contributor, Jakarta

Many people can't live without a mobile phone. With the wide
range of features incorporated, apart from being a versatile tool
of communication, it is also regarded by some as a fashion item,
as evidenced in the trendy designs on offer.

The rapid pace of development in telecommunications
technology, especially in cellular phones, has benefited
consumers, as many carry low price tags.

A certain segment, however, goes for the most advanced type --
generally referred to as the smartphone -- that contain almost
every feature needed for all sorts of telecommunications.
Naturally, they cost more.

One example is Motorola's latest product: the RAZR V3. The
super slim, clamshell cell phone with an attractive metal casing
and an array of features is believed by the manufacturer to have
a competitive edge and yet another stylish fashion item for
Indonesia's trendsetters.

Inside the small-sized gadget are various features to match
the segment's demands, such as a camera, speakerphone, Internet
access, MP3 ring tones, games (Java-based), a 2.2 high-resolution
screen, 3D graphics engine, bluetooth and a keypad with cool blue
electroluminescent backlighting.

Motorola also offers other hi-end products: the MPx with a 1.2
megapixel capacity and huge display that can be opened in two
directions, either for portrait or landscape; the V535 clamshell
with changeable covers (or "skins" as the producer refers); the
A768 Linux-based Personal Digital Assistant (PDA); and the E680
that provides more entertainment features. With its innovative
products, Motorola is aiming to regain its previous position as
the pioneer in the cell phone industry.

Other big players, including Nokia, Sony Ericsson, Samsung,
Siemens and Philips, have also launched their high-end products,
each with its own unique features. They are marketed partly in
answer to a number of latest needs, such as Multimedia Message
Service (MMS) that is also gaining popularity next to the already
established Short Message Service (SMS).

One of the premium gadgets (some brands sell for US$600) is
the smartphone that combines all the capabilities of a cell phone
and the functions of a PDA. Given the wide range of features, it
is comparatively heavier and bulkier.

Recently Finland-based Nokia has launched a number of cell
phones to match its market segment. For Indonesian high-end
customers, it has introduced the Nokia 9500 Communicator, which
was on display at a telecommunications exhibition in Cebit,
Hannover, Germany.

The 9500 Communicator incorporates a huge array of high-tech
features that fits its name, including a digital camera, WiFi and
EDGE/GPRS capabilities. It has easy access to computers using the
Universal Serial Bus (USB) wire as well as bluetooth. With a
price tag of Rp 9.5 million (about US$ 1,000) here it is much
slimmer than its predecessor, the Communicator that was launched
some eight years ago.

The company plans to launch early next year an extended
version, the 9300, and claims that data and voice communications
featured are superior than other PDAs currently available. For
Nokia, the 3G (third generation) communications is the target.

Meanwhile, Sony Ericsson has marketed the P800 that belongs to
the same class. The market of smart digital communications
gadgets is indeed becoming more competitive with another PDA, a
non-cellular type, on offer: the XDA IIs made by O2, which is a
stylish head turner. It also has a huge memory capacity -- 128 MB
-- with an operating system of Microsoft Windows Mobile 2003
(Pocket PC edition) and equipped with a 802.11b WiFi, bluetooth
and infrared connections via USB.

From Hewlett Packard comes the Ipaq 6365, a US$ 649 pocket
computer that can be used for making phone calls, writing notes,
presentations and wireless connections. Different from other PDAs
that use the Xsale processor made by Intel Corporation, the Ipaq
6365 uses the OMAP1510 processor made by Texas Instrument.

A recent survey by International Data Corporation (IDC)
reveals the growth of this year's cell phone sales globally at
about 30 percent compared to last year's sales of about 160
million handsets.

The smartphone segment, those with combined capabilities of
cell phones and PDAs, meanwhile, enjoys a larger percentage of
growth: 85.8 percent, with sales estimated at about 20 million by
the end of the year. The largest market share is also estimated
to be grabbed by those with software having the Symbian,
Microsoft as well as the PalmSource system.

According to IDC, five manufacturers dominate the 2004 market,
with Nokia having 29.3 percent share, Motorola 16.6 percent,
Samsung 13.1 percent, Siemens 8.4 percent, Sony Ericsson 5.8
percent, while other brands are fighting it out with a "share of
the pie", 26.9 percent.

In Indonesia, Nokia with a 32 percent market share, is still
the market leader. Motorola has improved its ranking, from its
previous fifth to this year's number three, with a nine percent
share, which is below Sony Ericsson's 17 percent.

Scott Durchlag, the vice president and general manager for
Personal Communications Sector (PCS) for Motorola Inc. Southeast
Asia operations, said that the company's recent achievement in
the region, including here in Indonesia, was the result of
implementing key strategies to win the market. "In the United
States, Canada and China, Motorola still leads the markets," he
said.

Cell phone and other sophisticated communications producers
agree that aside from being lucrative, the market is becoming
fiercely competitive, and only those with products that
accurately match consumers' demands, use the right marketing
strategies and sold at affordable price, will ultimately turn out
as the winners.