Really end is near for flagship phones with every tech product or any kind of products really it usually follows some kind of lifecycle. That product gets launched it starts to grow quite rapidly it usually hits a plateau and then sometimes if things don’t play out nicely just like that there can be a decline.
All brand cant able to sell their flagship phones
So, recently the quarter one result was released by a whole bunch of phone companies and the numbers don’t lie. Companies are having a rough time selling smartphones right now particularly expensive ones Apple’s.
iPhone sales were down again by quite a bit and the same thing goes for Google they actually don’t even appear in this chart like their sales figures don’t amount for a large enough percentage to show up on this stuff.
They mentioned that their hardware sales were lower a year and year and they’re citing kind of overall pressure in that premium segment we’re just super expensive phones are having a tough time moving right now.
There’s also Samsung so these guys launched the S10 devices this year. I thought they were pretty good I would say that the entire industry thought that they were pretty solid phones.
Despite being such good Hardware they’re stating that they still had poor mobile sales because of competition in the low to a mid-tier segment.
Huawei is doing better
There is one standout in this chart its Huawei they just crushed it in this quarter. They had a growth of 50 percent compared to the first quarter last year and in this market where everyone else is just not doing a great job at moving smartphones, these guys are doing work.
Analysts are saying that it’s because they have a nice spread of products in their repertoire like if you have some expensive stuff they have some cheap stuff so for the markets that they’re selling to that lineup works and the results speak for themselves.
They’re now in the number two position for global market share which is really impressive this is Huawei a company that had like one or two percent market share several years ago and like they’ve made some big moves.
The rest of the big boys are down on sales and analysts kind of disagree as to what the real cause is behind this. Some people are saying that it’s some global market like the global economy, some people are saying that the low-end market is kind of pushing everything out, people are saying that people just don’t want to upgrade phones as regularly.
All of those factors have a role I’m sure but this feels like the end game. Not that it’s like doom and gloom. But, this is the point where phone companies have to just either one or two things are going to happen.
Either they figure it out they create some kind of innovation like real innovation that Spurs people to purchase more phones either folding technology, 5g technology.
Whatever it is or the phone industry moves to this decline and we just get commoditization of smartphones.
That point where there’s just not enough meaningful differences between the brains. So, people start to buy phones based on their price tag and not the actual brand itself and manufacturers would fear this because at that point phones would compete primarily on price which is a terrible spot to be in if you’re one of the people making these phones.
So, for the past few years in this smartphone plateau companies have been doing whatever they can to convince people to buy new phones. Like they’ve been doing stuff like slowing down processors when batteries get old.
They Put offers to Sale Product
If you go through each one of these brands like they’re all trying to sell phones in these abnormal ways. like Google’s doing half price on their pixel phones a little while ago. They now have like $200 off Samsung has $200 off on a phone that’s like six or seven weeks old.
This is an s10 you go to Best Buy they’re $200 off even the s10 it’s crazy that says such a good phone but they’re having a tough time moving them $200 off.
iPhone even in China like iPhone just doesn’t drop prices normally but in China, they’re dropping prices because they got to move these phones. Premium smartphones are very difficult to sell right now.
So, a lot of companies are spending their effort and energies on the lower to mid to your markets like even Google that traditionally sells more expensive stuff their room it to launch a pixel 3a in the next couple of days because that’s what the market demands right now.
Interestingly though there is one company that’s kind of moving in the opposite direction Oneplus they started off as a budget brand and they supposedly have you know their OnePlus 7 launching soon. They’re supposed to be launching this Oneplus 7 Pro which I’m assuming is gonna be a much more expensive version so we can say that its END for Flagship Phones.
So, they’re kind of shifting to a more premium market seemingly maybe regardless all the phone companies are facing the same major issue if they’re not making innovative technologies that people actually want to spend money on.
Actually, want to buy and can make use of it then they run the risk of becoming a commodity this whole industry runs the risk of becoming like printers where the main differentiating feature is price.
If you look at Android phones and you kind of strip away the gimmicks and you strip away the minutiae that are different between them a lot of them look and feel quite similar to one another.
They have to do Innovation
Obviously, they’re different in terms of like you know details and software but the user experience is often really similar between Android phones and if this continues where the market doesn’t innovate and doesn’t do anything really different.
I could see this whole thing becoming a commodity iPhones may be able to dodge it like they’re running their own ecosystem they’re delivering something that’s quite different from everybody else otherwise end is near for flagship phones.
But, for the Android phones, they’re all becoming really good but just increasingly similar to each other and that’s kind of what commodities look like.