Some have derided it as just another “me too” product but mainland consumers aren’t listening. Nokia has sold more than a million of its X affordable smartphones since they went on sale in China in February. The new breed of Android handsets has been such a success that global smartphone makers might need to rethink their business strategy.
The global smartphone market is divided into three camps, running either on Apple’s iOS, Google’s Android or Microsoft’s Windows Phone. Android is by far the biggest kid on the block as the operating system behind more than 80 percent of the smartphones sold. Nokia, which used to use Windows Phone, went over to the Android camp early this year for its Nokia X series, even though the company is about to become a unit of Microsoft.
The Nokia X sells for less than US$100 and is a big hit among entry users looking for basic communications and internet access but not premium Google services or hardware specifications. Pricing, a strong brand presence and a different approach to promoting Android smartphones has helped Nokia lift its game.
Unlike other Android smartphones that feature several Google mobile services such as Google Search, Gmail, and Google Maps, the Nokia X is embedded with a wide range of Nokia and Microsoft applications, including the Bing search engine, Skype, Nokia’s Here online maps, as well as Hotmail services. It’s the first time Microsoft’s mobile apps have been combined with Google’s operating platform.
The flurry of Nokia X sales could send a huge amount of internet traffic to Microsoft services such as Bing and Skype. It could also divert income away from other smartphone makers and Google.
Google charges smartphone makers a premium to include some Google-specific mobile services like Gmail and Google Search on its handsets. But the success of the Nokia X suggests that these mobile add-ons don’t need to be part of an Android system — and other companies might want to rethink their Google app mix or come up with their own. The key is cost.
Google is reportedly already hard at work with Taiwan chipmaker MediaTek Inc. on a US$100 Google Nexus device to counter the Nokia X. The Nexus series has been the search engine’s flagship Android product and, if the speculation is true, it signals a huge change in Google’s hardware strategy.
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