The March of the Little Green Guy: $80 Android Phones in Developing Countries

Posted by MelissaUlbricht on Sep 12, 2011.

This year, Chinese company Huawei launched an $80 Android phone, the IDEOS, through Kenyan telecom Safaricom. According to sources, the phone has sold over 350,000 units in Kenya, “a staggering statistic considering nearly half of Kenya’s population lives on less than two dollars per day.”

We thought it important to take a closer look at this relatively low-cost device and the larger issues and questions that arise from it.

The Android Edge?

An article on Singularity Hub suggests that while affordability is a key driver for adoption, a larger issue with the IDEOS phone is the competitive edge of Android phones:

Now that hundreds of thousands of Kenyans have jumped on the Android bandwagon, it’s clear that affordability goes a long way. However, the IDEOS’s stellar sales performance in a developing nation hints at a larger phenomenon –  the international competitive edge of Android-capable, low-end smartphones.

What exactly does this mean? For developers, it may equate to more flexibility:

If app-gurus are free to program without rigid, Apple-like standardization, then they’re better able to tailor the Android to the needs of their communities. 

This is important, as apps play a key role in many mobile-based projects for social change. We’ve written about the role of Android-based apps in many areas: mHealthagricultural,environmental, and others.

There is also the question of whether IDEOS will spur development of other low-cost devices. Huawei manufactures low-cost Android phones and tablets for the Indian market, such as theBeetel Magiq, from Bharti Group firm Beetel Teletech. In the competitive and price-sensitive Indian mobile industry,  will rival companies attempt to introduce similar low-cost Android devices?

In addition to spurring competition, low-cost mobile devices may be beneficial to developers and companies outside of Huawei in China. In an article titled, “There will be two different iPhones in September and the cheaper one is more important,” suggests that a low-cost version of the iPod touch platform could be a boon for Apple:

Apple could use the iPod touch platform that debuted a full year ago to build a cheap iPhone device… This iPhone could be a world phone that works on all four (10?) US networks and abroad.  Apple already has Qualcomm Gobi chips in its Verizon iPhone and iPad… All of your friends may have an iPhone but only 8% of Americans have ponied up for one.  Apple could quadruple its market with a move like this.

 Recurring Questions

There are recurring questions of the $80 IDEOS phone, including how the cost was lowered, the quality of the phone, the need for the device, and additional costs associated with it.

How did Huawei lower the cost?

The answer may be by using less powerful hardware. A Singularity Hub article explains further:

So how did Huawei ride the demand curve below the golden price point, bringing an Android phone within the financial reach of thousands of Kenyans? Alongside the falling cost of all microelectronics, it appears that Huawei was able to lower the price by using less powerful hardware.

See the screenshot below (from the article) or here, which compares the display size, camera capability, RAM, talk time, and cost (without data plan) of IDEOS, Apple iPhone 4, Motorola Droid X2, Blackberry Bold 9780, and the IBM Simon, an early smartphone from 1994.

But, What’s the Quality? 

Another question is about the quality of the IDEOS device.  In a recent discussion thread some argued that just because a phone runs Android does not mean the phone itself is reliable.

Worldwide, there is a growing number of Chinese knock-offs, the so-called Shenzai phones, which we write about here. According to the MobileActive.org article:

Shenzhai phones are counterfeit, and there are obvious problems that stem from their outsider status. There are risks involved in buying the fake phones: no legal recourse if the phone doesn’t work as promised, reports of cheap batteries overheating/exploding, higher radiation levels and lower quality screens.

But Huawei IDEOS phones are not knock-offs. The Huawei brand name is on the IDEOS phone, and the company has several other Android phones already on the market.

Reviews on the IDEOS phone do mention what has become a bit of an Android curse – the limited battery life. A GeekZone article says that users “have been lamenting about the device’s fleeting battery life.” According to another article,  “an incessant need for recharging could present problems for IDEOS users in remote areas, where hunts for a power outlet may yield disappointing results.”

This has not gone unnoticed. Safaricom, for instance, posted this 6-step guide on reducing power usage on the IDEOS.

What’s the Market Saying? 

Is IDEOS a misplaced luxury or simply a good value in an increasingly mobile landscape?

In a recent discussion thread, some ask whether there is really a market for an $80 smartphone, in a country where 40% of the population live on less than $2 a day. One comment suggested that at tech or blogger meetups, most people had an IDEOS phone. But in Machakos, a small town outside of Nairobi, there were very few to none.

Some argue that other non-Android phones, such as many new Nokia and Samsung phones, also cost about $80. Coupled with the cost of computers, netbooks, or modems (which all run $80 or more on average) is the IDEOS not simply a competitively-priced option for a mobile device? Faced with other arguably inferior phones, is IDEOS just a better value?  Clearly, Kenyans seem to like the phone, looking at initial reported sales figures. We think it’s always a bit presumptious to question what is or is not ‘appropriate’ for a given country – market forces will decide this regardless of the options of well-meaning but misguided “ICT4D” practitioners.

What is compelling about the growth of Android worldwide (marketshare globally has grown to 50% this year, according to recent studies) is the ability to deliver relevant apps to customers.  The Android marketplace is realtively easy and inexpensive to develop for and there is a growing number of both large- and small-scale app entrepreneurs, development organizations, health and educational outfits in developing countries building Android apps. This makes Android phones – given the shrinking price point – very competitive vis a vis other smartphone platforms for which it is much harder to develop.  We will continue to watch this space and welcome your thoughts.

 

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