February 12, 2007
Talk – and everything else to do with phones – is getting cheaper
Price cuts were a key theme on the first day of the 3GSM World Congress in Barcelona.
Nokia, the word’s largest handset producers, launched a TV-enabled mobile handset at a mid-market price, a move it hopes will stimulate growth of the mobile TV sector. At around €370 before tax and operator subsidy, compared with €600 for Nokia’s previous N92 TV-phone, it is priced for the mass market.
Olli-Pekka Kallasvuo, chief executive of Nokia, said the mobile TV market would start to build rapidly, with 5m to 10m units sold globally in 2008, growing to 20m in 2009.
LG unveiled a cut-price 3G phone, winner of the GSM Associations competition to find cheaper high-speed phone technology. The handset will be available from the second quarter, and is expected to be around $100, 30 per cent cheaper than the current entry-level 3G phones.
Texas Instruments, one of the world’s largest suppliers of mobile phone microchips, was also pushing a message of affordability. Rich Templeton said the company was developing cheaper chips that would make high-end entertainment phones more affordable for consumers in emerging markets.
Mobile phone operators such as Nokia have recently focused on selling more basic models of phone into emerging markets like Indian and China. Nokia, for example, low-cost phones accounted for over 40 per cent of sales in 2006, compared with 23 per cent in 2005.
Texas Instruments has suffered. Not only do these lower-spec phones need fewer chips, but it has been designed out at the very low end, with Nokia recently sourcing chips for this segment from Infineon. Texas Instruments appears to have no choice but to fight back on price.
On the same theme was the announcement from O2 UK, part of Spain’s Telefonica, which abolished charges for receiving calls while abroad in 31 countries. Charges for receiving work calls while off on holiday have always seemed like insult added to injury and its good to see them go. Charges for calling back home to the UK while abroad were also cut to 25p a minute, a price O2 claims is 70 per cent lower than standard rates.
The rate cuts are not just altruism, however. O2, like other UK operators is under pressure from the European Commission to lower the fees they charge for connecting to other networks abroad. Last November the Commission criticised the UK telecoms and media watchdog Ofcom for not cracking down on the pricing.
I think very soon there is gonna be a steep fall in mobile and plan prices in UK..
Posted by: bhaskar | February 12th, 2007 at 8:56 pm | Report this comment