Analyst: The future is bleak for midrange cell phones

By Sharon Fisher | Published July 2, 2008, 6:02 PM

Midrange semi-intelligent phones such as Motorola's RAZR are gradually going to be subsumed by smart phones based on industry standard operating systems, predicted Kevin Burden, director of mobile devices for ABI Research.

The midrange phone market will dwindle as smart phones with high-level operating systems get pushed down the product line, Burden said. The reason, he explained, is because it is easier for manufacturers to deal with a standard operating system than with a real-time operating system that is often homegrown and that they have to create, update, and maintain themselves.

As examples of this trend, Burden pointed to the Motorola RAZR 2 - which uses an operating system based on Linux - and Nokia's recent purchase of Symbian, as well as its decision to offer it royalty-free.

Smart phones are also being pushed on the consumer side as users become more sophisticated and more comfortable with having this much processing power in their hands, Burden said: "Some people just want to make a phone call, but others demand more functionality." In particular, people -- especially those who use Internet devices such as Nokia tablets -- are demanding better mobile Web browsers (he calls the current proxy browser technology "painful") and notes that eventually, that functionality will be provided on the server level at carriers' sites.

This also means that smart phone prices are likely to be dropping to the mid-tier phone price level, Burden said, noting that the iPhone will now cost $200. There will always be high-end smart phones, he believes, because more processing power means users can run a variety of applications, but now there will also be low-end smart phones.

Comments

I bought an LG Chocolate brand new way back when and I still get mad at myself for spending that kind of money on a phone. I deserve to get slapped for it (plus the phone is a total POS). I have an ipod...i dont need anything on my phone but the ability to call people....and i definitely don't want windows on it...BUT...its inevitable, so I am sure in due time I will have a smartphone that I will never utilize for anything more than making phone calls and the occasional text message....then some idiot will text a virused chain letter to me and my phone will jam up.

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people get so wrapped up all of this. The motorola razor had great battery life, is thin and small, and lots of other features one would never even need.

shicaca they call them smart phones because not many if any smart people would waste money on them. Take the new i phone. On top of the insane price, you still have to pay more each month just to have it, let alone if you go all out like apple would like and purchase songs and media access from them. People are so superficial and waste money these days. The apple i phone target marked is morn than likely people with 30k annual income and less. you dont need a smart phone when flipping burgers at burger king shicaca.

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The article completely contradicts its self in addition to having a silly premise. The closing paragraph clearly states that it is just the available features on mid-range phones that are changing. It's a market: the tiers aren't going anywhere.

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I have to say that it's about time.

I do have to confess that I *did* spend the $200 for a Razr when it first came out to Verizon (you know, like 4 months after all the other providers), but after losing my contacts a few too many times/realizing I could just get a smart phone and not have to worry about that EVER AGAIN, I decided to go Smart phone, and haven't looked back since. Down with the Razr, Krzr, Slidr, Shine, etc. Give us phones that can do things that are USEFUL.

My only gripe w/ my smartphone is that multimedia messages (MMS) (Pix, Flix msgs) cost me money EVEN WITH the unlimited txting package. This is b/c they have to use the internet. But ... really ... that's it. Service is great, features awesome, etc. Down w/ the Razr!

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Let's see...

So capabilities will increase and prices will drop as they become commoditized...

It takes an "analyst" to come to this conclusion?

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Haha! That's exactly what I thought to myself!

I mean, commenting the obvious! What else is new? The earh is round? Sky is blue? We all gonna die someday? Wow, im aplying for analyst position right damn now! :|

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