The low-end mobile phone market is changing: all the big brands are rushing in

Meizu, which changed its market strategy this year, plans to release a product to cover the low-end market after releasing its flagship product.

Meizu said in its reply to Tencent Technology that due to the reduced production difficulty, its low-end products may completely squeeze out the copycat phones from the market. However, industry insiders are still willing to believe that Meizu is using products in different price ranges to "kill" its main competitor Xiaomi, especially the low-end market faced by Redmi.

Bi Xiaojia, an analyst at third-party analysis agency Canalys, told Tencent Technology that in the past year, Xiaomi opened up the low-end market through Redmi and Huawei opened up the low-end market through Honor, which put considerable pressure on Meizu. Therefore, Meizu, which used to only release one product, had to consider the low-end market after choosing a multi-line strategy, even if lowering the price would affect its long-established brand.

However, from a macro perspective, the reason why competition in a certain price range has become so fierce is that as the growth of China's smartphone market slows down, mobile phone manufacturers need to seek new development space. In particular, smartphones have entered the middle stage of development, and manufacturers have reached the stage of seizing market share and increasing the number of users.

Products priced below 1,500 yuan have been the choice of about 70% of mobile phone buyers in China in the past year. At the same time, this part of the market, even the market below 1,000 yuan, has long been occupied by "copycat phones" and some brands that have faded from the user's sight.

The strong market demand and the lack of high-quality products will make low-end products an important weapon for increasing shipments in the subsequent product layout of mobile phone manufacturers such as Meizu, Xiaomi, Huawei, and even Lenovo.

The low-end market enters the brand era

Unlike the competition in high-end models in the European and American markets, the price range of China's smartphone market has been sinking since its inception. The thousand-yuan market grew from 2009 to 2010, the 600-1,000 yuan price segment grew in 2011, and the ultra-low-end market began to grow in 2012. Subsidies from operators are the main driving force.

In 2014, the adjustment of terminal subsidy structure of operators and the reduction of incremental market slowed down the growth of ultra-low-end market. At the same time, in the market of 600-1000 yuan price segment, major brand mobile phone manufacturers launched Internet brands and increased cooperation with e-commerce. This made the low-end smartphone market enter the brand era from operator customization.

In the open market, the entry of manufacturers such as Meizu and Xiaomi, which have accumulated user reputation, will further squeeze the space of manufacturers such as Tianyu and Xiaolajiao. The reason is that the configuration of low-end products is relatively fixed, and Meizu and Xiaomi, which can provide differentiated user experience and services, are more attractive to users.

Bi Xiaojia said that the mobile phone market is becoming more and more saturated and competition is becoming more and more fierce. If manufacturers do not have their own characteristics, it will be difficult for them to survive in the market.

Not all manufacturers are suitable for low-end

With the further development of the 4th and 5th tier cities and the faster replacement frequency of mobile phones, the low-end mobile phone market will still have room for growth compared to the overall market. Therefore, manufacturers whose products focus on the mainstream market will choose to enter this market.

Yan Zhanmeng, an analyst at third-party analysis agency IDC, said that in order to enrich the product line, manufacturers with strong financial strength will choose to enter. Judging from the current market, in addition to Meizu, "China Cool Alliance" is bound to enter this market.

But it is worth noting that not all manufacturers are willing to enter this market.

OPPO told Tencent Technology that it currently has no plans to enter this market. In fact, manufacturers such as vivo and OPPO, which focus on the music or imaging market segments, do not choose to enter the low-end market because it is difficult to add high-quality functions to low-cost products.

Emerging brand OnePlus also said it would consider the balance between product experience and price. OnePlus believes that although low-end products lower the threshold for users to buy, there will be a sacrifice in product experience, which is inconsistent with its market positioning.

However, some commentators believe that this is related to its initial publicity, because OnePlus has emphasized its high-end product positioning since the beginning of its publicity. The launch of low-priced products in the short term will affect its expectations in the minds of consumers. "The price reduction of the Hammer phone has proved that a sudden change in price will trigger a public opinion crisis."

Chip manufacturers are behind the industry

The most common rumor about Meizu's new product is that it will use MediaTek's chips to design low-end products, rather than Samsung's Orion chips used in its flagship products. Meizu and MediaTek have cooperated to test the waters on the MX4, and now they may introduce this relationship to low-end products, because the latter's chip products have been widely used in products priced at or below 1,000 yuan.

In addition, MediaTek's cooperation with Google on the Android One platform may benefit Google as it assumes the responsibility for Android updates and attract manufacturers who want to enter emerging markets to launch low-end smartphones with lower barriers to entry.

But for the low-end market in 2015, the entry of Intel and Qualcomm 's expansion into the low-end may trigger a new round of competition.

During this year's Hong Kong Electronics Fair, Intel demonstrated a 6-inch screen smartphone to its partners, sending a signal to the outside world: Intel plans to gain new market share in the smartphone market and will launch a reference design for the smartphone market that will facilitate shortening the production cycle.

In this regard, an Intel insider told Tencent Technology that the SoFIA integrated mobile system chip platform developed by Intel and its cooperation with Spreadtrum and Rockchip on low-end chips are aimed at the entry-level mobile phone market. The strength of Intel in promoting this business also proves the importance of the entry-level mobile phone market.

Although its prospects are still unclear due to the merger of its mobile chip and PC chip departments, it can be seen that if it subsidizes its partners with the same intensity in 2015, it will inevitably attract some small and medium-sized mobile phone manufacturers to join.

Qualcomm revealed at a recent analyst conference that more than 470 LTE terminals based on Snapdragon 400 and 200 chipsets are currently being designed; and its "turnkey" solution can shorten the terminal development time to less than 60 days.

Cristiano Amon, executive vice president of Qualcomm Technologies and co-president of QCT, said that manufacturers began a lot of design work as early as the chip release and customer communication stage, which was an unprecedented success.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.