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Developing-market carriers call for sub-$50 smartphone

Smartphone cost is the biggest barrier to mobile broadband in poorer countries, carrier executives said

Executives of mobile operators that serve developing countries called on the GSM Association on Tuesday to kickstart the development of a sub-US$50 smartphone.

Smartphones are falling in price, but the cost of smartphones is the main barrier to wide adoption of mobile broadband in poorer regions of the world, three executives said in a keynote session devoted to developing markets.

The leaders of carriers that operate in Asia, Africa, Eastern Europe and Latin America said the GSMA, which represents network operators, should reprise its 2006 call for proposals for a sub-$30 GSM (Global System for Mobile Communications) phone. Its Emerging Market Handset initiative led to two Motorola handsets that exceeded the group's expectations, as operators in developing countries quickly ordered more than 12 million units.

Affordable smartphones could have a big impact on poor countries, some of which don't have wired Internet services for most of the population. A smartphone would be the first Internet access device for many consumers, said Sunil Bharti Mittal, founder, chairman and CEO of India's Bharti Enterprises, which operates Bharti Airtel in 19 Asian and African countries.

Bharti sees the mobile Internet helping rural residents in India in many areas of life, including health care.

"The difficulty that we will have for the next model will be how to provide very inexpensive smartphones in the country," Bharti said. Less than 5 percent of handsets in India are smartphones, and the percentage is even less in Africa, he said.

Some operators in the developing world have talked about the idea of a tender for 100 million smartphones priced at less than $50, "with all the bells and whistles," Bharti said.

"The big bottleneck is the affordability of the handsets," said Santiago Fernandez Valbuena, chairman and CEO of Telefonica Latin America. Jo Lunder, CEO of Vimpelcom, also said handset cost will be the key factor in driving mobile Internet use. Vimpelcom owns mobile carriers in 17 developing markets in Africa, Asia and Eastern Europe, Once consumers have good devices for using the Internet, average revenue per user will go up, taking care of the carriers' business model, the executives said. Networks and radio spectrum are not a big issue, except in some countries where governments have fumbled the allocation of spectrum, they said.

Bharti emphasized that access to the mobile Internet could have a big impact on developing countries.

"Broadband, which is a game changer for Europe and America, is a life changer for my countries," he said.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is [email protected]


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