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Smartphone Industrial Analysis
Project
Smartphone Industry
What Is a SMARTPHONE?
Mobile phone with more advanced computing capability,
connectivity, advanced multimedia capabilities and the
ability to install third-party software than basic features
of phone.
Smart Phone and Feature Phone
SMARTPHONE FEATURE PHONES
Uses of smartphones?
• Text Messaging/SMS
• Email
• Social Networking
• Streaming Online Music
• Video / Mobile TV
• Mobile Banking
• Location Based Services/GPS
• Applications
• Web Browsing
• Mobile Shopping
• Barcode or QR Scan
• NFC/Mobile Wallet
• Games
• News
History
• 1995 The first smartphone, the IBM Simon
• 1996 Nokia launched Nokia 9000
• In early 2000, the Ericsson R380 was released by Ericsson
Mobile Communications, and was the first device marketed
as a "smartphone“
• The first catalyst of the expansion of the smart phone
market was the release of RIM’s Blackberry series in 2001.
• The impetus for the expansion of the smartphone market
was the release of Apple’s innovative iPhone in July. 2008.
Major Events in History
• 1996 First Windows CE Handheld PC devices are introduced.
• 2000 Symbian becomes the first modern mobile OS on Ericsson R380.
• 2002 Microsoft's first Windows CE (Pocket PC) smartphones are introduced.
• 2007 Apple iPhone with iOS is introduced as an iPhone.
• 2008 OHA releases Android 1.0 with the HTC Dream
• 2009 Samsung announces the Bada OS with Samsung S8500.
• 2010 Windows Phone OS phones are released.
• 2013 BlackBerry released BlackBerry 10.
• 2013 Google release Android Kitkat.
• 2014 Microsoft release Windows Phone 8.1 in February 2014.
• 2014 Apple release iOS 8 in September 2014.
Classification of Smartphones
In terms of Money
Lower End – Below 12k
Mid Range - 12K to 24 K
High End – Above 24 K
Trend in market
• Hardware Trend
RAM, MEMORY, SCREEN, BATTERY,
Shape, Size and type of Smartphones
• Software Trend
• Utility
• LTE – 2G – 3G – 4G
• Price
Major OS Platforms
Current software
platforms
Android
iOS
Windows
Blackberry OS
Discontinued software
platforms
Symbian
BADA
Java
Sailfish OS
New Emerging OS
Firefox OS
Tizen OS
Ubuntu Touch
Major Companies
SMARTPHONE
1.75 Billion
38.4%
FEATURE PHONES
2.8 Billion
61.6%
4.55 Billion Mobile Phones are there worldwide
Smartphone market size and value
The global smartphones market is
estimated to reach $150.3 billion in
2014 from about $55.4 billion in 2009.
Sales figures (in millions of units)
Year
Android
(Google)
iOS (Apple)
Windows
(Microsoft)
2011 219.52 89.26 8.77
2012 451.62 130.13 16.94
2013 758.72 150.79 30.84
2014Q1 229 43.7 6.2
2014Q2 255 7.4
According to Coda Research Consultancy:
Total sales volume is 234 m
units in 2010 and expected
to be 619 m units in 2015
Total volume are forecast
to reach 1.8 billion units in
2018.
A 12.7% CAGR for the 2013-
2018.
• Smartphones hold 10 % market share among India’s mobile
phone using population
• Below $200 smartphones accounts for 4/5 of total Indian
smartphone sales.
• In 2014, an astounding 450 million smartphones are likely to be
shipped in china alone .
• Smartphone shipments will double between now and 2018
within key emerging market including India, Indonesia, and Russia.
• Local companies are sacrificing profit margins to build market
share in India, which counts 914 million mobile users.
• India is now the quickest–expanding smartphone market
globally and 3rd-largest market after china and the U.S.
Smartphone shipment by OS
Factors for Market Growth
The Popular Wi-Fi configuration and 3G
telecommunications are considered the largest
components behind the optimistic growth forecast for
the smartphone market.
Advanced Operating systems with more computing like
activities.
Enabling users to seek information instantly.
Market dynamics
• Industry is a duopoly.
• High financial concentration in 1 company
• Samsung dominates the Android ecosystem.
• Established manufacturers are being squeezed.
• Smartphone designs have reached a plateau.
Current market analysis
The newly formed competitive structure of the
smartphone market can be divided into three market
segments:
(1) Hardware manufacturing
(2) Operating systems
(3) Content
1. Smartphone manufacture hubs
Huawei
• Produces optical network transmission equipment in a plant in Chennai of South India
and manufactures wireless network equipments whilerefraining from elaborating the
investment amount for the plant.
• Huawei also has started the building of self-developed research and development park
in Bangalore.
Lava
• U.P based mobile handset company.
• The company also has a manufacturing plant and intends to start end-to-end
manufacturing of mobile phones soon.
• Lava is also planning to set up a full-fledged R&D center in Bangalore soon.
Karbonn
• Mobile handset manufacturer based in Bangalore.
• Collaborated with leading semiconductor companies for their handsets.
• Exports its handsets to Africa, South Asia and Middle East countries.
Lemon
• Working with ODM and OEM partners.
• Innovation center in north India to design and develop handsets as per
trends in the Indian market.
LG
• Established in 1997, (South Korean Company).
• Market leader in consumer durables and recognized as a leading
technology innovator in IT and mobile communications business.
• Started in 2004, manufacturing unit in Haridwar in 2005.
• Presently Bringing handsets to India market from China under a
contractual manufacturing from a local vendor.
• Micromax manufacturing company located in Gurgaon.
• It has over 23 national and international offices.
• Micromax with a 19.1% share is the 2nd largest smartphone brand in terms
of shipments, closely following Samsung (25.3%).
Motorola
• US cellphone manufacturer Motorola has its handset manufacturing
facility at Sriperumbudur, Chennai.
• This includes GSM and CDMA mobile devices and networking equipment
such as base stations and system controllers.
Samsung
• Global leader in semiconductor, telecommunication, digital media and digital
convergence technologies.
• Leading producer of digital TVs, semiconductor chips, mobile phones and TFT-
LCDs.
• Has its mobile manufacturing unit in Noida (U.P) as sixth overseas manufacturing
unit in the world.
Spice
• Spice is one of the first Indian mobile device players.
• has multiple interests in the telecom, media and retail space.
• manufacture at its plant at Baddi, Himachal Pradesh.
ZEN MOBILE
• Aim- To provide quality products and services to customers in India,
• Started operations in 2009. It has tied up with a China based ODM, but it
designs phones locally.
• Actor Amitabh Bachchan is its brand ambassador.
• Local manufacturing is also one of its priorities and Zen is working
towards starting manufacturing locally.
2. Operating systems
Smartphone market has shifted from hardware to software:
Google, Apple, Blackberry, Microsoft have become the leaders in
this market for developing and providing operating systems to cell
phone manufacturers.
iOS Vs Android
• Android devices have exceeded iOS,
continuously winning increasing market
share.
• Android users purchases lower cost
devices compared to Apple.
• Android might command the market,
but Apple has a grip over that smaller
part of the market share who is willing
to spend.
• Android might have the quantity, But
Apple has quality consumers.
3. Content
Content developers form another competitive axis because content is
provided to application stores.
Forecasts and analysis: Asia pacific
• Developed Asia–Pacific: 96% of handset
sales will be smartphones in
2018
• Emerging Asia–Pacific: 47% of connections
will be smartphones by
2018, and the market will continue to
grow steadily beyond the forecast
period
smartphone
non smartphone
Smartphone’s share
Indian Smartphone Market Analysis
• Indian market is owned by
Samsung and Micromax.
• Market share of them combined is
52% of the Indian market .
• Micromax can be the leader in Indian market.
How Micromax become Indian market leader
• It launched his phone in every range.
• Despite manufacturing of smartphone by itself they relied on several
individual units worldwide like –
Borrow technology from SHENZHEN , CHINA.
• Sponsorship of cricket tournaments in asia pacific make it popular amongst
them .
• It attracts over 130000 outlets in india across 560 districts.
• Always rely on Free android for their phones
• Use pricing strategy of amazon in which price of final product is equivalent
to the individual components
- Large customer base
- Brand name
- Technology
- Low manufacturing Base
- Focus on too many
products
- Rising 3G uptake
- Growing rural numbers
- Growing tablet market
- Competition
- Rapid change in technology
- Saturated market in
Developed countries
2 Bs 2 Bs
Porter’s 5 forces Analysis
The threat of substitute products
The threat of existing Rivals
The threat of new entrants
The bargaining power of customers
The bargaining power of suppliers
3 Ts 3 Ts
Threat of Substitutes
• Low Buyer inclination to substitute
• High switching costs
• High price-performance ration (value)
Intensity of Existing Rivalry
• Fast Industry growth rate
• Low Product differentiation:
• High margins
• Brand identity
• High diversity of rivals
• Large industry size
• Exit barriers are low
Threat of New Competitors
• Strong distribution network required
• High capital requirements
• High sunk costs limit competition
• Strong brand names are important
• Advanced technologies are required
• Industry requires economies of scale
• Entry barriers are high
• High switching costs for customers
• Patents limit new competition
Bargaining Power of Suppliers
• Large number of substitute inputs
• High competition among suppliers
• Critical production inputs are similar
• Volume is critical to suppliers
Bargaining Power of Customers
• Increasing Buyer volume
• Increased price sensitivity
• Low threat of backward integration
• Low Product differentiation
• Low dependency on distributors
China Vs India
Majors in the market and their products
The Indian mobile economy is growing rapidly and will contribute
approximately $400 Billion to India’s GDP.
contribution
Global GDP Contribution
Supply chain
Present Market share
CONCLUSION : Smartphone Industry
o Tremendous technology has transformed the world.
o Exploded into market and became a part of popular culture.
o Revolutionized the communication between people.
o Instant access to information.
o Very popular due to its versatility.
(Advanced Photo sharing, Games, Internet services etc.)
o Parallel growth required so the product remains relevant.
o Constantly changing society will undoubtedly evolve
smartphones.
o Move with demands, otherwise entire industry will suffer.
o Endless opportunities.
o Applications give Smartphones an extra edge.
o Future is promising to the growth rate of industry.
Issues with Smartphone
• Battery Life
• Environmental
• Worker conditions
• Social
• Legal/Patent war
• Security
• Disturbing sleep
ORIGIN OF OTHER INDUSTRIES
• Accessories – Screen Guards, Phone Covers,
Earphone, Memory Cards etc.
• Speakers, Data Cables, Power Banks etc.
• Telecom Services (3G and 4G)
• Application Industry
Employment status
Smartphone industry opens up so
many Jobs Domains and Helps in
the growth of Different
Industries and thus Creates a
huge margin of Jobs worldwide.
o In 2015, developed markets will almost complete their
transition to smartphones.
o Android remains the dominant operating system over the
forecast period.
o Smartphone market has become most competitive and
complex.
o Smartphone industry is dynamic.
o low margins for the majority.
Adverse effects of smartphones
THANK YOU

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Smartphone industry analysis

  • 2. What Is a SMARTPHONE? Mobile phone with more advanced computing capability, connectivity, advanced multimedia capabilities and the ability to install third-party software than basic features of phone.
  • 3. Smart Phone and Feature Phone SMARTPHONE FEATURE PHONES
  • 4. Uses of smartphones? • Text Messaging/SMS • Email • Social Networking • Streaming Online Music • Video / Mobile TV • Mobile Banking • Location Based Services/GPS • Applications • Web Browsing • Mobile Shopping • Barcode or QR Scan • NFC/Mobile Wallet • Games • News
  • 5. History • 1995 The first smartphone, the IBM Simon • 1996 Nokia launched Nokia 9000 • In early 2000, the Ericsson R380 was released by Ericsson Mobile Communications, and was the first device marketed as a "smartphone“ • The first catalyst of the expansion of the smart phone market was the release of RIM’s Blackberry series in 2001. • The impetus for the expansion of the smartphone market was the release of Apple’s innovative iPhone in July. 2008.
  • 6. Major Events in History • 1996 First Windows CE Handheld PC devices are introduced. • 2000 Symbian becomes the first modern mobile OS on Ericsson R380. • 2002 Microsoft's first Windows CE (Pocket PC) smartphones are introduced. • 2007 Apple iPhone with iOS is introduced as an iPhone. • 2008 OHA releases Android 1.0 with the HTC Dream • 2009 Samsung announces the Bada OS with Samsung S8500. • 2010 Windows Phone OS phones are released. • 2013 BlackBerry released BlackBerry 10. • 2013 Google release Android Kitkat. • 2014 Microsoft release Windows Phone 8.1 in February 2014. • 2014 Apple release iOS 8 in September 2014.
  • 7. Classification of Smartphones In terms of Money Lower End – Below 12k Mid Range - 12K to 24 K High End – Above 24 K
  • 8. Trend in market • Hardware Trend RAM, MEMORY, SCREEN, BATTERY, Shape, Size and type of Smartphones • Software Trend • Utility • LTE – 2G – 3G – 4G • Price
  • 9. Major OS Platforms Current software platforms Android iOS Windows Blackberry OS Discontinued software platforms Symbian BADA Java Sailfish OS New Emerging OS Firefox OS Tizen OS Ubuntu Touch
  • 11. SMARTPHONE 1.75 Billion 38.4% FEATURE PHONES 2.8 Billion 61.6% 4.55 Billion Mobile Phones are there worldwide Smartphone market size and value The global smartphones market is estimated to reach $150.3 billion in 2014 from about $55.4 billion in 2009.
  • 12. Sales figures (in millions of units) Year Android (Google) iOS (Apple) Windows (Microsoft) 2011 219.52 89.26 8.77 2012 451.62 130.13 16.94 2013 758.72 150.79 30.84 2014Q1 229 43.7 6.2 2014Q2 255 7.4
  • 13. According to Coda Research Consultancy: Total sales volume is 234 m units in 2010 and expected to be 619 m units in 2015 Total volume are forecast to reach 1.8 billion units in 2018. A 12.7% CAGR for the 2013- 2018.
  • 14. • Smartphones hold 10 % market share among India’s mobile phone using population • Below $200 smartphones accounts for 4/5 of total Indian smartphone sales. • In 2014, an astounding 450 million smartphones are likely to be shipped in china alone . • Smartphone shipments will double between now and 2018 within key emerging market including India, Indonesia, and Russia. • Local companies are sacrificing profit margins to build market share in India, which counts 914 million mobile users. • India is now the quickest–expanding smartphone market globally and 3rd-largest market after china and the U.S.
  • 16. Factors for Market Growth The Popular Wi-Fi configuration and 3G telecommunications are considered the largest components behind the optimistic growth forecast for the smartphone market. Advanced Operating systems with more computing like activities. Enabling users to seek information instantly.
  • 17. Market dynamics • Industry is a duopoly. • High financial concentration in 1 company • Samsung dominates the Android ecosystem. • Established manufacturers are being squeezed. • Smartphone designs have reached a plateau.
  • 18. Current market analysis The newly formed competitive structure of the smartphone market can be divided into three market segments: (1) Hardware manufacturing (2) Operating systems (3) Content
  • 19. 1. Smartphone manufacture hubs Huawei • Produces optical network transmission equipment in a plant in Chennai of South India and manufactures wireless network equipments whilerefraining from elaborating the investment amount for the plant. • Huawei also has started the building of self-developed research and development park in Bangalore. Lava • U.P based mobile handset company. • The company also has a manufacturing plant and intends to start end-to-end manufacturing of mobile phones soon. • Lava is also planning to set up a full-fledged R&D center in Bangalore soon.
  • 20. Karbonn • Mobile handset manufacturer based in Bangalore. • Collaborated with leading semiconductor companies for their handsets. • Exports its handsets to Africa, South Asia and Middle East countries. Lemon • Working with ODM and OEM partners. • Innovation center in north India to design and develop handsets as per trends in the Indian market. LG • Established in 1997, (South Korean Company). • Market leader in consumer durables and recognized as a leading technology innovator in IT and mobile communications business.
  • 21. • Started in 2004, manufacturing unit in Haridwar in 2005. • Presently Bringing handsets to India market from China under a contractual manufacturing from a local vendor. • Micromax manufacturing company located in Gurgaon. • It has over 23 national and international offices. • Micromax with a 19.1% share is the 2nd largest smartphone brand in terms of shipments, closely following Samsung (25.3%).
  • 22. Motorola • US cellphone manufacturer Motorola has its handset manufacturing facility at Sriperumbudur, Chennai. • This includes GSM and CDMA mobile devices and networking equipment such as base stations and system controllers. Samsung • Global leader in semiconductor, telecommunication, digital media and digital convergence technologies. • Leading producer of digital TVs, semiconductor chips, mobile phones and TFT- LCDs. • Has its mobile manufacturing unit in Noida (U.P) as sixth overseas manufacturing unit in the world.
  • 23. Spice • Spice is one of the first Indian mobile device players. • has multiple interests in the telecom, media and retail space. • manufacture at its plant at Baddi, Himachal Pradesh. ZEN MOBILE • Aim- To provide quality products and services to customers in India, • Started operations in 2009. It has tied up with a China based ODM, but it designs phones locally. • Actor Amitabh Bachchan is its brand ambassador. • Local manufacturing is also one of its priorities and Zen is working towards starting manufacturing locally.
  • 24. 2. Operating systems Smartphone market has shifted from hardware to software: Google, Apple, Blackberry, Microsoft have become the leaders in this market for developing and providing operating systems to cell phone manufacturers.
  • 25. iOS Vs Android • Android devices have exceeded iOS, continuously winning increasing market share. • Android users purchases lower cost devices compared to Apple. • Android might command the market, but Apple has a grip over that smaller part of the market share who is willing to spend. • Android might have the quantity, But Apple has quality consumers.
  • 26. 3. Content Content developers form another competitive axis because content is provided to application stores.
  • 27. Forecasts and analysis: Asia pacific • Developed Asia–Pacific: 96% of handset sales will be smartphones in 2018 • Emerging Asia–Pacific: 47% of connections will be smartphones by 2018, and the market will continue to grow steadily beyond the forecast period smartphone non smartphone Smartphone’s share
  • 28. Indian Smartphone Market Analysis • Indian market is owned by Samsung and Micromax. • Market share of them combined is 52% of the Indian market . • Micromax can be the leader in Indian market.
  • 29. How Micromax become Indian market leader • It launched his phone in every range. • Despite manufacturing of smartphone by itself they relied on several individual units worldwide like – Borrow technology from SHENZHEN , CHINA. • Sponsorship of cricket tournaments in asia pacific make it popular amongst them . • It attracts over 130000 outlets in india across 560 districts. • Always rely on Free android for their phones • Use pricing strategy of amazon in which price of final product is equivalent to the individual components
  • 30. - Large customer base - Brand name - Technology - Low manufacturing Base - Focus on too many products - Rising 3G uptake - Growing rural numbers - Growing tablet market - Competition - Rapid change in technology - Saturated market in Developed countries
  • 31. 2 Bs 2 Bs Porter’s 5 forces Analysis The threat of substitute products The threat of existing Rivals The threat of new entrants The bargaining power of customers The bargaining power of suppliers 3 Ts 3 Ts
  • 32. Threat of Substitutes • Low Buyer inclination to substitute • High switching costs • High price-performance ration (value)
  • 33. Intensity of Existing Rivalry • Fast Industry growth rate • Low Product differentiation: • High margins • Brand identity • High diversity of rivals • Large industry size • Exit barriers are low
  • 34. Threat of New Competitors • Strong distribution network required • High capital requirements • High sunk costs limit competition • Strong brand names are important • Advanced technologies are required • Industry requires economies of scale • Entry barriers are high • High switching costs for customers • Patents limit new competition
  • 35. Bargaining Power of Suppliers • Large number of substitute inputs • High competition among suppliers • Critical production inputs are similar • Volume is critical to suppliers
  • 36. Bargaining Power of Customers • Increasing Buyer volume • Increased price sensitivity • Low threat of backward integration • Low Product differentiation • Low dependency on distributors
  • 38. Majors in the market and their products
  • 39. The Indian mobile economy is growing rapidly and will contribute approximately $400 Billion to India’s GDP. contribution
  • 43. CONCLUSION : Smartphone Industry o Tremendous technology has transformed the world. o Exploded into market and became a part of popular culture. o Revolutionized the communication between people. o Instant access to information. o Very popular due to its versatility. (Advanced Photo sharing, Games, Internet services etc.)
  • 44. o Parallel growth required so the product remains relevant. o Constantly changing society will undoubtedly evolve smartphones. o Move with demands, otherwise entire industry will suffer. o Endless opportunities. o Applications give Smartphones an extra edge. o Future is promising to the growth rate of industry.
  • 45. Issues with Smartphone • Battery Life • Environmental • Worker conditions • Social • Legal/Patent war • Security • Disturbing sleep
  • 46. ORIGIN OF OTHER INDUSTRIES • Accessories – Screen Guards, Phone Covers, Earphone, Memory Cards etc. • Speakers, Data Cables, Power Banks etc. • Telecom Services (3G and 4G) • Application Industry
  • 47. Employment status Smartphone industry opens up so many Jobs Domains and Helps in the growth of Different Industries and thus Creates a huge margin of Jobs worldwide.
  • 48. o In 2015, developed markets will almost complete their transition to smartphones. o Android remains the dominant operating system over the forecast period. o Smartphone market has become most competitive and complex. o Smartphone industry is dynamic. o low margins for the majority.
  • 49. Adverse effects of smartphones

Editor's Notes

  1. Diff b/w smart ph and mobile phne
  2. The first mobile phone to incorporate PDA features was an IBM prototype developed in 1992 and demonstrated that year at the COMDEX computer industry trade show. A refined version of the product was marketed to consumers in 1994 by BellSouth under the name Simon Personal Communicator. In early 2000, the Ericsson R380 was released by Ericsson Mobile Communications, and was the first device marketed as a "smartphone“ Smartphones before Android, iOS, and Blackberry, typically ran on Symbian, which was originally developed by Psion. It was the world's most widely used smartphone operating system until Q4 2010.
  3. Smartphones are being classified here in terms of money as- Lower range (below 12 thousand Rs.) Mid Range (between 12 to 24 Thousand Rs.) High End (above 24 thousand) Here the sales of different classes in each OS category is shown – Android and windows phone are very famous in lower range smartphones while iOS (apple) don’t deal in it. International Data Corporation = IDC
  4. From Intel 24MHz i386 CPU and just 8MB of memory to todays many cores GHZ processor like dual core , quadcore. As hardware improves smartphones are becoming increasingly more powerful.. as the older phones has rams in mbs just below the 100 mb and now the rams is available in Gbs. Now we have 1gb..2gb.. 3gb ..ram available in a tiny smartphone. Similarly the ROM ie Read only memory or in mobile terms we can say it internal memory has been keeping on increasing as from 5mb Rom to 64 Gb Rom as we see in the case of model mi3 of xiaomi brand. 1. 64-Bit Processors 64-bit chips manages RAM more effectively than 32-bit processors, so the smartphones of the future will be even faster. This will translate to improved graphics performance, improved HD-video playback, and faster speeds all around. Users can expect processes such as encryption to be also sped up in a 64-bit phone. Models such as HTC’s Desire 510 and Lenovo’s Vibe Z2 are fitted with the 64-bit-enabled Snapdragon 410 by Qualcomm. Another HTC phone, the Desire 820, also uses a 64-bit capable chip, the Snapdragon 615. In addition to Intel and Qualcomm, manufacturers such as Nvidia and MediaTek are working on 64-bit processors. But it was Apple that first pushed for the trend to incorporating 64-bit processors in smartphones, by building the iPhone 5s with the 64-bit A7 chip in 2013. While the HTC and Lenovo phones mentioned above are already 64-bit enabled, they won’t be able to maximise performance from these processors until the Android L operating system – a 64-bit OS – is released by Google this year. LTE-Advanced Technology In addition to faster speeds, the smartphones of the next few years will have faster networking speeds. The Snapdragon 805 chip, for example, supports the LTE-Advanced technology, which means any phone using that chip will be able to realise network speeds of up to 300Mbps. The LTE-Advanced technology offers faster speeds by delivering data over multiple frequency bands simultaneously. However, the faster speeds will only be available if the user’s mobile operator has a compatible network that’s optimised for these faster speeds. According to research by ABI Research, this is gradually coming true in many geographic regions. Smartphones with LTE-Advanced or similar technology include the Samsung Galaxy Note 4 and Huawei’s Ascend Mate7. Quad HD Screens It seems that smartphones can’t get any bigger without turning into tablets, so users looking for more phablet models might be disappointed. However, there’s another trend in smartphone screens that bodes well for consumers. Resolution is the other area that’s seeing massive improvements, and with LG’s G3 – which comes with a 5.5-inch, 2560-by-1440 pixel resolution screen – the future of smartphone screens appears to be in the direction of better quad HD screens with very high resolutions. ‘Quad HD’ refers to the fact that these are screens with four times the resolution of 720p HD displays. While it’s only been just over a year since 1080p displays entered the market, manufacturers are already looking to quad HD and beyond to differentiate their devices on the market. Samsung also offers smartphones with quad HD screens, through the Galaxy Note 4, which comes with a 5.7inch screen. If smartphone manufacturers are to continue releasing phones that improve on those in previous generations, quad HD screens and screens with even high resolutions.. Tizen is an operating system based on the Linux kernel and the GNU C Library implementing the Linux API by the end of this year the first Samsung Tizen OS phone is expected to be released.
  5. The market has been dominated by the Android operating system since 2010 As of the end of Q2 2014, Android was the most popular operating system, with a 84.7% market share, followed by iOS with 11.7%, Windows Phone with 2.5% and BlackBerry with 0.5%. These are discontinued because nobody likes to work on windows 98 when they actually have the windows 8 available in the market.
  6. Apple BlackBerry Google HTC Huawei Lenovo LG Electronics Microsoft Motorola Nokia Samsung Sony Mobile TCL Xiaomi ZTE
  7. At the end of the 2013 year, 1.4 billion smartphones will be in use: 798 million of them will run Android, 294 million will run Apple's iOS, and 45 million will run Windows Phone, according to a new study by ABI Research. THERE are around 7 billion people on the earth. 4.55 Billion Mobile phones means = 63.5% of world Population have phones The global smartphone audience surpassed the 1 billion mark in 2012 While the economic recession adversely affected the global markets; the global smartphones market was one of the very few markets that did not have impact of the global meltdown. The smartphones market with an annual growth rate of 12.8% from 2008 to 2009 is expected to grow by 26% over 2009 to become a $69.8 billion market in 2010. The Asia-Pacific smartphones market stood at $17.1 billion in 2009 which is expected to become a $45.2 billion market in 2014 growing at a CAGR of 18.6% during 2009 – 2014.
  8. ANDROID IS THE KEY PLAYER SINCE 2011 AND STILL IT IS THE KING IN SALES FIGURE . IOS AND WINDOWS COME AFTER IT. As of the end of Q2 2014, Android was the most popular operating system, with a 84.7% market share, followed by iOS with 11.7%, Windows Phone with 2.5% and BlackBerry with 0.5%.
  9. Compound annual growth rate (CAGR) is a business and investing specific term for the geometric progression ratio that provides a constant rate of return over the time period.
  10. The previous smartphones were limited by the unstable wireless Internet environment, slow mobile Internet connections, and limited content.
  11. Original equipment manufacturer (OEM) is a term used when one company makes a part or subsystem that is used in another company's end product. An original design manufacturer (ODM) is a company that designs and manufactures a product as specified and eventually rebranded by another firm for sale. Such companies allow the brand firm to produce (either as a supplement or solely) without having to engage in the organization or running of a factory.
  12. The main purpose of Porters Five Forces is to find a position in an industry where a company can defend itself against competitive forces or it can influence them in its favour. A strategist can analyse, any market by rating each competitive force as high, medium, low in strength and rate as follows. If we look at the mobile phone industry worldwide, the five forces could be rated as follows. The threat of new entrants is seen as low, because the technology investment needed to compete in this fast moving industry is high. The threat of substitutes could be described as low, due to the added functionality that smart phones and mobile phones have over single featured technology products such as digital cameras. The bargaining power of buyers could be rated as medium, with a wide variety of mobile phones available. Customers have major brand choices and don't mind paying higher prices, for the latest smart phones and mobile phones. The bargaining power of suppliers is medium because mobile phone manufacturers rely on their key suppliers for quality component parts at competitive prices and the operating system such as android is open source. In conclusion, competitive rivalry is very high for mobile phones, with major brand competitors such as Samsung, Apple, Nokia and Sony competing and dominating the industry. New entrants could find it very hard to compete and gain economies of scale and market share against major brand players in this industry.
  13. Mobile phones have become necessity for everyday lives of people and its hard to replace with any substitute products especially when they are away from home. There exist multiple substitute products e.g. for contacting people, usage of social media, emails and VOIP systems are substitutes, digital cameras for photography, TV/radio/iPod for listening music, tablets for internet browsing, reading books, emailing etc. But potentially all the value from substitute products could be derived from a single smartphone, needless to say each substitute product might cost more than the mobile phone and need to be carried all the time. No other substitute product has the ability to make phone calls, send messages, surf the web, reading a book, listening to music, use GPS services, communicating via social media and many more in one device. The idea of being in constant communication with someone at anytime and anywhere makes the mobile phone a very important device to people and the perceived value by user (price-performance) ratio is very high.
  14. 1. Intense competition is forcing many vendors and operators to drastically change their business models or risk dropping out of the market as economies of scale, segment leadership, brand power and distribution become key determinants of success. 2. There is also very little differentiation between the competitors and the loss of market share of Nokia during recent years means that any new smart phones in the market will find it difficult to tempt existing competitor device consumers to switch. 3. The smartphone segment offers the largest returns for many in the mobile value chain, and it has therefore become the most competitive – attracting all the major vendors competing across various operating systems and price tiers. Huawei has set an ambitious goal for itself: to ship 60 million smartphones in 2012, an increase of 200% year-on-year. 4. : Brand identity is vital for long term success in mobile phones market. But there is still growing competition e.g. from Chinese 'microbrands' and grey market (mainly in the emerging regions like India). 5. Over 2011 Nokia’s sales were down 18% in China, 27% in Europe and 61% in North America. Nokia has faced increased competition from low-cost phone manufacturers such as ZTE and Huawei (mostly in China and Europe). highly perishable products that depreciates quickly in the market. Producers need to sell quickly, which intens" is an easily defendable qualitative factor, so competing institutions will have a difficult time overcoming it. Price wars Large industries allow multiple firms and produces to prosper without having to steal market share from each other. Large industry size is a positive for Smart Phone Industry This statements will have a short-term positive impact on this entity, which adds to its value. When industries are growing revenue quickly, they are less likely to compete, because the total industry size is also growing. The only way to grow in slow growth industries is to steal market-share from competitors. Fast industry growth positively affects Smart Phone Industry. When exit barriers are low, weak firms are more likely to leave the market, which will increase the profits for the remaining firms. http://www.wikiwealth.com/five-forces:smart-phone-industry
  15. Weak distribution networks mean goods are more expensive to move around and some goods don’t get to the end customer. The expense of building a strong distribution network positively affects Smart Phone Industry. High capital requirements mean a company must spend a lot of money in order to compete in the market. High capital requirements positively affect Smart Phone Industry. High sunk costs make it difficult for a competitor to enter a new market, because they have to commit money up front with no guarantee of returns in the end. High sunk costs positively affect Smart Phone Industry If strong brands are critical to compete, then new competitors will have to improve their brand value in order to effectively compete. Strong brands positively affect Smart Phone Industry. Advanced technologies make it difficult for new competitors to enter the market because they have to develop those technologies before effectively competing. The requirement for advanced technologies positively affects Smart Phone Industry. Economies of scale help producers to lower their cost by producing the next unit of output at lower costs. When new competitors enter the market, they will have a higher cost of production, because they have smaller economies of scale. Economies of scale positively affect Smart Phone Industry. When barriers are high, it is more difficult for new competitors to enter the market. High entry barriers positively affect profits for Smart Phone Industry. High switching costs make it difficult for customers to change which products they normally purchase, due to costs. High switching costs positively affect Smart Phone Industry. Patents that cover vital technologies make it difficult for new competitors, because the best methods are patented. Patents positively affect Smart Phone Industry. In China It is strong for several key factors: The economies of scale, the scale economies in production, R&D, marketing and finance is not large enough to be key barriers the product differentiation level is high The policies made by the Chinese government support the entry into the IT industry which includes the smart phone market. Access to the distribution channel is not difficult.
  16. Large number of substitute inputs When there are a large number of substitute inputs, suppliers have less bargaining leverage over producers. This is due to competition among substitutes that is the equipment manufacturers . Greater competition positively affects Smart Phone Industry. There is competition among suppliers to cope up with the demand for fast growing requirements of device manufacturers High competition among suppliers -High levels of competition among suppliers acts to reduce prices to producers. This is a positive for Smart Phone Industry. Critical production inputs are similar-When critical production inputs are similar, it is easier to mix and match inputs, which reduces supplier bargaining power; a positive for Smart Phone Industry. Its like the same hardware configuration can be produced by different suppliers and hence they have competition in market to sell it. Volume is critical to suppliers - When suppliers are reliant on high volumes, they have less bargaining power, because a producer can threaten to cut volumes and hurt the supplier’s profits. This can positively affect Smart Phone Industry Supplier concentration: Nokia suppliers for hardware components are not concentrated and there are actually large number of equipment manufacturers that Nokia could switch to. including Nokia.  High differentiation of inputs: Nokia does not depend on a key equipment manufacturer. It buys different hardware components from multiple vendors and Nokia possesses its own assembling factories where the devices are assembled.  Moderate impact of inputs on cost or differentiation: There is growing trend of differentiation based on hardware specifications (dual-core processors, physical memory, NFC support, wide-screen, screen glass etc.) which affects the final selling price and margins. But overall, mostly margins are dictated by software and application ecosystem.
  17. 2. Consumers (end buyers) volume is continuously increasing globally despite recession in recent years in some regions and saturation in some. Asia-Pacific market (developing countries) is expected to grow at even higher rate in coming years. The continued fall in handset prices in most segments, notably smartphones, with devices with greater capabilities now available at a lower price point have also lead to increase in consumer volumes. 3. Price differentiation is getting lower and lower as device manufacturers are facing fast changes in designs, technical and data capabilities leading the buyers to price sensitive in their buying decision. With lot of competitors offering similar packages, the buyers are seeking out best value for their money. 4. Some mobile operators have started building their own mobile phones under their brand (e.g. Videocon in India) but still have not been hugely popular. So the threat is still low. Most of the mobile phone manufacturers have their own stores to directly sell to consumers. 5. In the cut-throat mobile industry, the product differentiation factors are getting lower. If when player comes up with a new feature or technology improvement, it is taken by competitive player very soon e.g. dual-core processors, wide-screen, LTE, etc. 6. When produces have low dependence, distributors have less bargaining power. Low dependency positively affects Smart Phone Industry.
  18. The smartphone shipments to India have increased by 120% whereas Android smartphones sales have boosted by 160%. Summing it up… The Indian smartphone market is skyrocketing since the past few years. Entry-level Android phones are the consumers’ first choice as they provide all the essential features at an affordable price. Facebook is where most of the Opera Mini Android users spend their time while the rest of the time is utilized for browsing shopping portals, video sharing websites, education and job portals. The visits to video sharing websites have grown by 205%, but I believe that this number will go even higher with the advent of affordable 3G and 4G data plans. Where do you spend a major fraction of your browsing time? Don’t tell me that it’s on Google.
  19. Smartphone is a tremendous technology that has transformed our world in a variety of different ways. It has exploded onto the mainstream market and has become a part of popular culture. It has revolutionized the motions of communication between people. Allows instant access to information in the palm of our hands In just a few years, Smartphones have become very popular as major developers has created new ways in which we can use our Smartphone. Much of Smartphone’s capabilities revolve around the applications that it offers. This is very important in determining the future of a Smartphone. Apps give Smartphones an extra edge that ordinary phones do not have. Such apps include advanced photo sharing, games, or Internet services Much of a Smartphone’s capabilities revolve around the applications that it offers.
  20. It is believed that over the next several years, these phones will begin to adapt assets that allow them to have complete voice control, include projectors, 3D screens, holograms, and a more clear and accurate sound. As technology in general continues to advance, it is necessary that smartphones parallel this growth so the product remains relevant. Technologically speaking, it is clear that people are being impacted significantly on a social scale from smartphones. Smartphones are obviously becoming more human with the advancement of all its features, and the projected future of this industry proves this to be true. Society is constantly changing, as well as its technologies, and smartphones will undoubtedly evolve. If not, then smartphones will cease in popularity. The company has a parallel business that reinforces the profit margin made on hardware. Increasingly this is in the realm of content and services. The best example here remains Apple but Samsung, Sony and others are striving to emulate Apple's success. ƒ The company enjoys substantial advantages of scale, supply chain and costs that enable it to compete profitably using a margin-based hardware model. We believe Lenovo in particular is poised to challenge Samsung's dominance in this regard.
  21. Environmental Obtaining the resources required to create smartphones involves the mining of minerals such as coltan, which are toxic to humans and wildlife. Other raw materials, such as oils, copper, plastics, and solvents, have the potential to contaminate both the soil and groundwater. Smartphones also contain toxic chemicals such as lead, bromine, chlorine, mercury, and cadmium. The improper recycling of used smartphones damages the environment. Mobile phones can contain dangerous chemicals such as antimony, cadmium, copper, lead, arsenic, nickel and zinc, which can run off into surrounding water bodies or seep into soil contaminating wildlife and drinking water. Worker conditions The capacitors in electronics use minerals mined in developing countries. Workers, including children, have been forced to work at gunpoint while mining for smartphone materials. The electronics soldering in smartphones require tin, 30% , The tin extraction process has been identified as environmentally destructive Social Human interaction has changed from direct to virtual – smartphone addiction has caused a lot of human brain change and a lot of lost learned skills – lack of concentration. Legal smartphone patents licensing and litigation is an ongoing business battle by smartphone manufacturers including Sony, Google, Apple Inc., Samsung, Microsoft, Nokia, Motorola, and HTC, among others, in patent litigation. The conflict is part of the wider "patent wars" between multinational technology and software corporations. To secure and increase their market share, companies granted a patent can sue to prevent competitors from using the methods the patent covers. Since 2010 the number of lawsuits, counter-suits, and trade complaints based on patents and designs in the market for smartphones, and devices based on smartphone OSes such as Android and iOS, has increased significantly. A "patent war" between Samsung and Apple started when the latter claimed that the original Galaxy S Android phone copied the interface—and possibly the hardware—of Apple's iOS for the iPhone 3GS. Security Malware, virus, Trojans, personal information theft etc Disturbing sleep Using smartphones late at night can disturb sleep due to the bright screen light affecting melatonin levels and sleep cycles – causing lack of concentration – weak eyesight and other psychological, medical problems by radiation of wave spectrum and screen radiation.  
  22. The mobile phone industry in India would contribute US$ 400 billion in terms of gross domestic product (GDP) of the country in 2014.  This sector which is growing exponentially is expected to generate about 4.1 million additional jobs by 2020, as per Groupe Speciale Mobile Association (GSMA).
  23. The shift to smartphones is expected to continue in all regions. In 2015, developed markets will almost complete their transition to smartphones, with small demand for entry- level phones remaining. This will see mature markets become almost entirely dependent on replacements and will raise the stakes for growth in emerging markets. Even on a global basis, 2015 will see the installed base of smartphones overtake that of feature phones. Android remains the dominant operating system over the forecast period but a growing proportion of shipments do not deliver Google services. The operating system becomes less strategically important over the forecast period as the ecosystem war moves further up the software stack. The mobile phone and smartphone market has become more competitive, complex and connected over the past three years. Connected not just in terms of connectivity and sensor advancements, but the smartphone segment's interrelationship with other markets and business models. It is myopic to discuss the mobile phone and smartphone markets and their value creation, either directly or indirectly, in isolation. Burgeoning ecosystems from the Web, a new wave of content and services and convergence with other established and emerging hardware segments are all affecting how value is created and extracted from the smartphone market. This has two fundamental consequences: ƒ Firstly, it means that the smartphone market is as dynamic as ever and is far from the permanent two-horse race between Apple and Samsung that is depicted by some industry commentators. In addition, although an operating system duopoly exists between Android and iOS, fragmentation caused by Chinese government regulation and ecosystem growth on top of Android means the competitive significance of this duopoly is declining. Android's dominance does not translate directly into dominance for Google. The complexity of the smartphone market and its broader relationship with other technology segments and business models means change is likely to be abrupt and substantial. ƒ Secondly, success in the smartphone market and the way in which value is extracted is fundamentally changing. This raises questions about which attributes will define success over the four years of our forecast period given the challenges facing an abundance of traditional mobile phone manufacturers. ƒ The company has a broader business model such as advertising or retail that mobile extends and enriches thanks to its advantages of reach, engagement, context, connectivity and increasing affordability. Good examples are Amazon and Xiaomi; both supply hardware but margin is largely derived elsewhere. Attributes are not mutually exclusive, nor will they characterise all players that participate in the smartphone market over the coming years. The low barriers to entry that have come to typify smartphone manufacturing means the long tail of manufacturers will continue to grow. However, this long tail will be characterised by extremely low margins for the majority. Further change and disruption to the smartphone industry is highly likely over the forecast period. Samsung's dominance is set to come under growing pressure from the combined abundance of smaller Chinese players and new manufacturing challengers with mounting scale and cost advantages. Furthermore, the necessity for diversification will see Samsung face mounting competition from Web players from both East and West. This too will affect Apple: its successes in delivering content and services and in hardware integration will determine its progress and the speed at which it too feels growing pressure on profit margins.