US$99 smartphone ready to hit emerging markets: will it make it into Africa?

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Two weeks ago, Synchronica, a UK based company developing and selling next-generation mobile messaging solutions, launched the “MessagePhone”, a low cost smartphone aimed at mobile users in emerging markets. Last week, at the Mobile World Congress in Barcelona (MWC), Vodafone unveiled the “Vodafone 150” handset which the company presented as the "lowest-cost mobile phone on Earth" aimed at developing markets. The quest for “market with potential growth” is on and the words “low cost” and “emerging markets” are becoming the mantra among the telecommunication industry. Isabelle Gross looks at what’s in the bag with Synchronica’s low cost smartphone and how it will fit in the African market.

Synchronica’s low cost smartphone comes in two versions, the MessagePhone QS 150 and QS 200. The QS 150 is the entry-level handset and has the following core features. It is bundled with Synchronica Mobile Gateway and provides push email and synchronization for consumer and business (Exchange, Yahoo, Hotmail, Gmail, etc), a fully featured HTML web browser, instant messaging and social network access, multimedia player and a camera. The QS 200 which is the big brother of the QS 150, has faster processor with larger memory capacity, a fast Internet access and quad band radio, better multimedia and FM radio and PC connectivity and Bluetooth. Hardware-wise, it is worth noting that the MessagePhone has a full QWERTY keyboard and a 2-inch TFT screen. The battery provides close to 6 hours in talk mode and up to17 days in stand-by mode. The two smartphones only work so far over GPRS/EDGE mobile networks (not 3G).

According to Carsten Brinkschulte, CEO of Synchronica, the MessagePhone QS 150 could retail at a price as low US$99 including shipping costs and duties.

This smartphone which is the result of nine months collaboration between Synchronica, KC Mobile, Brightstar and mobile operators, will according to Synchronica’s CEO, address the device price barrier for accessing the Internet in emerging markets. Brinkschulte says further that the MessagePhone comes as an affordable connected phone with business functionalities, instant messaging and a full Internet browser. Will a Qwerty keyboard and a large screen be attractive enough (beside price and functionalities) to stop African mobile users from wanting to be the owner of a BlackBerry or an iPhone, especially among the young and urban population?

Mass market adoption of the MessagePhone will also depend on how well Synchronica is right on the targeted user profile. The company is aiming the low cost smartphone at the middle-class mobile users in emerging markets. The typical customer is likely to be a small business owner or an employee earning between US$300 and US$500 per month.

They already own a basic mobile phone which they use for telephone calls and SMS. They spend between US$3 (e.g. in Pakistan) and US$12 (e.g. in Sudan) per month on telecommunication services. They don’t own a PC and probably they won’t be able to afford one anytime soon. Therefore they visit on a regular basis an Internet café to check their business and private e-mails, browse the Internet for news, products and services and chat with friends and family members living abroad.

According to a survey carried by Strategy Analytics and, MyMetrix ComScore 2008, only 10% of mobile users have mobile e-mail but a staggering 78% want access to mobile e-mail which is forecast to generate over US$7 billion revenue per year by 2014. In parallel, the total market for Mobile Instant Messaging solutions is estimated to grow with a CAGR of 54% over the next 6 years in Latin America and Africa according to Frost & Sullivan. The estimated number of mobile IM users in Africa could grow from less than 50 million in 2010 to over 200 million in 2015 generating an annual revenue close to US$1 billion.

Synchronica, which focuses on next generation mobile messaging infrastructure software and already works with African mobile operators like MTN, Zain or Sudatel, has partnered for the MessagePhone with KC Mobile from Korea and Brightstar, a US leader in distribution and supply chain of wireless equipment. KC Mobile is the developer of the smartphone and has a portfolio of OEM mobile products combined with a vast experience in the development of white-labelled solutions. The MessagePhone is manufactured in China for cost reasons. Brightstar, on the other hand, has built a global footprint over the last 12 years by distribution wireless equipment in nearly 50 countries across 6 continents. The company has been particularly active in emerging markets with the distribution of low cost devices to operators in these markets.

To further strengthen its position as a leader in the low cost smartphone segment, Synchronica intends to bundle the MessagePhone to its Mobile Gateway software offering to mobile operators an intelligent data platform and a smart but cheap device that goes with it. Both the MessagePhone handset and the Mobile Gateway platform can be operator-branded. The Mobile Gateway platform is also device-neutral allowing devices of other manufacturers. As the fight for managing the user’s identity carries on between operators, device manufacturers and portals, Synchronica’s offers will enable operators to connect mobile users to existing Internet communities (Facebook or Twitter) and build operator-hosted communities.

As Synchronica’s launched its two MessagePhone, China Unicom and Huawei announced during the WMC that there was a need for better handsets to put 3G into full use. They have pledged to start collaboration on the development of a 3G smartphone with iPhone-like capabilities at US$150. The race for producing low cost smartphone is definitely on. Synchronica has already sold the MessagePhone to one African mobile operator. One thing for sure is that African mobile users will have a wider choice of smartphones at an affordable price in the next 12 to18 months.