Manufacturers focus on all-in-one handsets

Newsroom 02/06/2008 | 15:43

When choosing a phone, users look first at battery life, followed by the camera and the screen. Other important characteristics are the memory, Bluetooth, MP3player and games, Florin Petrescu, handsets manager at Vodafone Romania, tells Business Review.
“A lot of people are interested in the models that incorporate a camera, as they are passionate about taking spontaneous, high-quality pictures, while more and more customers are going for the MP3 player option. There is also a large segment of the market that simply wants to use the mobile phone for conversation and sending SMS. Others are very interested in design,” adds Carmen Capitanescu, director of regional marketing at Sony Ericsson.
A study by PMR Consulting (an Anglo-American regional research and consulting company) found that the telecom segment in Romania totaled over EUR 4 billion in 2007, which translated into a 30 percent increase as compared to 2006. Greig Williams, managing director for Nokia South-East Europe, makes reference to this study labeling the local market as “very dynamic” with consumers who “know exactly what they're looking for in a mobile device.” He estimates growth will continue in all segments but primarily on the converged mobile devices segment which offers additional features like cameras, music players and increasingly GPS.
“In general, the Romanian market appreciates mobile devices with a stylish and more fashion-oriented design, but what the users really want is the ideal combination between design, features and dependability,” he says. “The trend we're seeing is that users would like to have one device with all the functionalities they need: integrated camera, music player and with increased mobile broadband services, and connectivity capabilities.”
Raluca Nicolae, country manager of TCCM, tells Business Review that the market will become more clearly segmented. “There will be on the one hand users of voice and SMS and on the other hand those who use the mobile phone as a mobile computer. The smart phone segment is definitely in full swing especially now when the technology allows for a great deal of innovation in this sense,” says Nicolae. HTC recently launched in Romania the Touch Diamond model only nine days after the international launch. “On the map of launches in 2008 there will probably be an upgrade of the TyNN II model and at least two new models by the end of the year,” she says.
One of the trends for this year is the intensified development of the 3G network supported by a portfolio expansion of 3G handsets offered by producers. “In 2008 we expect an increase in sales of 3G handsets which will be accessible to a broader category of users,” Han Khyu, President of LG Electronics Romania, tells Business Review. He speaks about progress both in the degree of usage of mobile telephony but also in broadband internet connections. “Users want to keep in touch with friends all the time, to send data content at higher speeds and this trend is reflected in the market.”
Equipment suppliers are more focused on based on internet access and supplying HSDPA. The LG Electronics Romania official says that the fashion segment, especially the luxury one, is developing “on the back of Romanians' increasing appetite for unique gadgets with exclusive design. Our estimates on the local market for the current year are 5 million handsets.”
Gabriel Maranca, Motorola mobile devices sales manager, tells Business Review that while in the past the view of what a mobile phone should offer was confined to the quality of voice channels and written messages, this has changed. The mobile phone is now an all-in-one experience. More users are looking for complex entertainment functions such as efficient cameras and audio players as well as mobile office functions with internet access and mobile e-mail.
“The Romanian market is shared between demanding customers who opt for innovating functions or prestigious design and pragmatic customers who are looking for good phones at accessible prices. This is precisely why the bulk of the sales is concentrated on models in the medium segment which represents the middle solution between price and functionality,” Maranca adds.

What sells like hot cakes and what new launches are on?
Most buyers prefer terminals which sell for less than RON 300,” says Petrescu, who expects the mid-range segment to have the highest boost in sales. Vodafone will pay special attention to handsets which provide multimedia functions, internet access and to the range under the Vodafone brand which was expanded with the Vodafone models 227, 228 in February and most recently with Vodafone 527, a model which is compatible with mobile internet.
This year Vodafone will sell two terminals in the high-end category – Nokia N96 and Sony Ericsson Xperia. The firm estimates it will sell 20 percent more handsets in 2008, a growth which targets all its distribution channels – its own stores, partner networks and direct sale channels.
Nokia is Romanians' top brand, with seventy percent of phones sold locally. Models that performed very well were the XpressMusic range (5310, 5220 and 5220) and Nokia 6300 and the multimedia computer N73. “However, in growth markets like Romania where the expansion is fast, we see that under-EUR 50 handsets are the key volume driver. Here the consumer chooses dependability and service as a key purchase criteria and this is very important for Nokia as the market leader,” says Williams.
Sony Ericsson, Samsung representative HAT Group Co, LG Electronics Romania and Motorola are also optimistic, with entertainment options among the key drivers of growth for many local handset providers.

By Otilia Haraga

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