UK launches show WP7 chasing the midmarket
ZTE Tania and cut-price Lumia 710 indicate Microsoft's best hope, of targeting youth users and midrange segments
Published: 20 January, 2012
READ MORE: UK | Nokia | ZTE | Handset | Windows Phone
The UK, one of the most competitive of mobile markets, is highlighting Microsoft's drive to get WP7 into the key growth area for handsets, midrange smartphones. Nokia is reported to be slashing the price of its midmarket Lumia 710 in the country, while ZTE has launched two affordable WP7 models.
While Microsoft's spin doctors chase headlines bracketing WP7 smartphones with the Android superphones, there is logic to devoting significant resource to the midmarket. This is where primary partner Nokia's strength lies; Microsoft has been quietly cultivating alliances geared to lower cost devices, with MediaTek and others; it will be easier to gain market share in the midrange than among the brand- or technology-driven superphone customers. Most importantly, WP7 is, in the medium term, doomed to be confined to the middle turf, since it has no high end growth path - on tablets and other advanced mobile device categories, it is replaced by Windows 8.
The importance of the affordable market saw Nokia launching the 710 last fall, at the same time as its Lumia flagships, and the less highly specified model was the first to hit the US shelves, with T-Mobile. Now the Finnish vendor is said to have cut UK prices for the device, even before it ships. It will go on sale next month and was expected to be priced around £25 to £30 with two-year contract, but that figure has already been reduced to £20, a source "familiar with the situation" said, according to the Financial Times.
Some carriers, notably O2 UK, had criticized the Lumia range for being overpriced, when it first appeared late last year. The source said Nokia was "in the process of establishing a new pricing platform" to stimulate consumer interest while delivering decent margin - always a difficult balancing act in handsets, especially with a new platform which carries an element of risk for the operators. Nokia's advantage is that, despite its recent troubles, it still has the scale, supply chain efficiency and knowledge of the low end device business to have considerable leeway on pricing.
In the US, there have also been price cuts to the T-Mobile 710, at least at Wal-Mart, which is now offering the phone for free with two-year contract. However, TMo itself and rival retailer Best Buy continue to sell the product for the regular $49.99 with contract, indicating that the handset is considered attractive enough to be used as a competitive weapon.
Meanwhile, another vendor accustomed to the price sensitive market, ZTE, aims to double its smartphone business this year and is working closely with Microsoft as well as Android. It launched its first UK handset of 2012 this week, the WP7-based Tania, which will be sold free with contract commitments of just £10 to £20 a month. This keen pricing is designed to appeal to the youth market (the phone is endorsed by UK rapper Professor Green) and to establish the little known brand of ZTE, which has generally sold white label devices to carriers in the past.
Pages: 1 | 2
More UK News
More NOKIA News
More ZTE News
COMMENTS
Carrier Broadband Performance: Africa & Middle East
Carriers are using mobile broadband as their weapon of choice in the fight against the commoditization of voice and falling ARPU. This...
Voice over LTE: Market Analysis and Forecasts
VoLTE offer unique advantages in lowering a carrier's voice infrastructure economics and promises to improve voice quality, device...
Satellite Phones: Will Dual Mode Help the Phoenix Rise from the Ashes?
Satellite phones have followed an arduous path since their much-hyped launch more than a decade ago. The hype was followed by an e...
