Startup tips: Two challenges and opportunities in Cellphones and Application Digitization

The market for smartphones in the US and much of Europe seems to be saturating and the rate of growth has slowed considerably. Mobile service providers are beginning to look at emerging markets including China and India.

India, which leapfrogged the lack of older Telecommunications (POTS) networks with its mobile revolution is poised to move its users to the smartphone era. However, this comes with a few challenges which are unique to India –

  • Extremely cost conscious consumers and
  • Low bandwidth needs

The ‘challenges’ that may sound as constraints to some of us translate to opportunities for entrepreneurs and startups.

Challenge 1: Extremely cost conscious consumers who demand value and style

The market for cellphones and smartphones in India is not homogeneous. There are some consumers who are willing to fork out $1000 (Rupees 65,000) for iPhones while many prefer phones under $75 (less than rupee 5000).

Recognizing this need, and to make a statement, Apple announced plans to make its iPhones in India. Of course, one may also read between the lines to see that the phones are not really going to be “made in India” but rather “assembled” in India using parts and processes imported by Apple.

Nokia too is eying the mid-segment market in India and just launched three Android-based handsets, the Nokia 6, Nokia 5 and Nokia 3, marking what it hopes is a major comeback both globally and in the Indian smartphone market. This is coming right after the company announced the much-awaited Nokia 3310 feature phone across top mobile stores in India for Rs 3,310.

Opportunity to serve cost conscious consumers: This challenge is already being seen as an opportunity by smartphone makers.  Micromax is the second largest smartphone brand in India with a 22 percent market share, closely trailing Samsung at 26 percent, according to IDC. The homegrown smartphone brand is now gunning to topple Samsung’s lead. The market is also dominated by brands from other Indian and Chinese manufacturers. App makers and startups are also exploring opportunities to engage consumers with ‘free’ apps.

Source: Counterpoint

Challenge 2: Low Bandwdidth Devices and Apps

Until recently, there was little attention being paid to opportunities at the bottom-of-the-pyramid. This may be about to change as large technology firms, including Microsoft, Google, Apple, Facebook and others have sensed an opportunity in serving first-time smartphone owners. These strategic moves by tech-heavyweights are also being closely monitored by entrepreneurs and startups eager to carve out niche in serving customers with low-end, low-bandwidth smartphones.

Users in markets like India who graduate from cellphones to low-end smartphones are hesitant to sign-up for expensive data plans. Many users manage to sustain services with pre-paid plans and top-up their mobile accounts on a need basis.

At its recent global Developers Summit, google emphasized support for “Progressive Web Apps” (PWA) for its developer ecosystem with user experiences that have the reach of the web, and are:

  • Reliable – Load instantly and never show the ‘downasaur’, even in uncertain network conditions.
  • Fast – Respond quickly to user interactions with silky smooth animations and no janky scrolling.
  • Engaging – Feel like a natural app on the device, with an immersive user experience.

Opportunity: Software companies have realized the need for customizing Apps for emerging markets. Mobile Apps designed for high-end smartphones that require strong and steady bandwidth don’t work well – or don’t work at all. Entrepreneurs and startups have signed up for PWA and other mobile development platforms that enable the development of low-bandwidth applications. Some developers are experimenting with techniques to auto-recognize available bandwidth and switch Apps between low and high bandwidth, based on availability.

Also check out our earlier article on the topic

Opportunities in Smartphone race to the bottom – Design two speed, Lite and Regular mobile apps

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