Sony Mobile to exit entry-level smartphone segment? Unlikely in our view

by XB on 14th January 2013

in News

There has been some chatter over the last few days that Sony Mobile may look to leave the entry-level smartphone tier. The comments came from Stephen Sneeden, the Sony Xperia product marketing manager, who you may have seen from some videos in last week’s CES tradeshow.

He told Cnet Asia that the “very entry level is where you lose the ‘Sonyness’ and it’s where you cannot implement some of these wonderful things from Sony at such a low cost.” He went on to say that Sony “cannot compromise on the experience that the company is trying to show to the customer” and that it “might leave the very entry tier to some other manufacturers”.

Sneeden suggests that Sony may instead focus its efforts on the mid to high-end smartphone segment. Features from the top-range phones will then trickle down to mid-range phones over time. “Maybe it’s not the flagship product, but I can still aspire to this other phone that has a number of these same characteristics,” Sneeden said.

We’re not convinced that Sneeden is revealing Sony Mobile’s 2013 strategy here. Sony Mobile had a wide portfolio of low-end devices in 2012 and we don’t see any reason why this will change this year. Industry estimates suggest that the entry-level segment will continue to grow year-on-year. Research house IHS says that by 2016, 31% of the global overall handset market will be low-end smartphones.

Budget smartphones are big business, even if they don’t have the same margins of flagship devices. You just have to look at Nokia’s recent results which pointed to 14 million devices sold in the last three months, however only 4.4 million were mid to high-end Lumia devices, the rest being its entry-level Asha range.

Whilst we’d like to see a more focused portfolio from Sony Mobile, we’re not sure this will be the case in 2013. Sony will continue to deliver on its flagship products, but we find it hard to believe that it will forego such a large part of the smartphone market.

What is your view on this? Should Sony continue to cater for all in the smartphone segment or is a more focused strategy on the mid-high tier necessary to drive the company forward? We’d love to hear your thoughts below.

Via Cnet Asia.

Thanks maxiobor and Nico!

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