Mozilla Shatters the Smartphone Affordability Barrier

by Jeff Wiener on February 25, 2014

Almost a year ago to the day I wrote a post outlining the future of the mobile market, one where companies would have to rethink their entire smartphone development strategy in order to reach the untapped market of the developing world. In fact it was at last year’s Mobile World Congress that Manoj Kohli, CEO of carrier Bharti Airtel—which operates in India and Africa—gave a hard target for the mobile world to aim for; now, at this year’s MWC, that target has been hit.

In order to reach the “next billions”, that is, the vast untapped market of the developing world, smartphones would have to break the ‘affordability barrier,’ Kohli argued in his keynote address last year, placing a number of $30 on true affordability for those currently still enjoying their antiquated feature phones; that is, those who stand as the next market demographic to entertain smartphone adoption. But the problem is that the price of smartphones is nowhere near that number, some of the cheapest options available still more than double that price.

To that end, last week Mozilla made headlines about its attempt to break that affordability barrier, with rumours it would be trying to outdo the $79.99 unlocked off-contract phones it unveiled in 2013, driving the price of budget smartphones ever lower. But it turns out that Mozilla’s plans were far more ambitious than anyone ever would have guessed, as earlier this week the company has announced its plans to bring $25 smartphones to many developing markets, not only breaking the affordability barrier, but absolutely shattering it.

There’s no question that reaching the developing world with smartphone technology has been difficult, given that unlike antiquated cell or feature phones, modern smartphones aren’t made specifically with data consumption constraints in mind, a problem that plagues even the most powerful 4G LTE networks, meaning there’s little chance these phones (at least in their current form) will ever be affordable, let alone work, in emerging markets.

In order to reach these potential customers what companies need is an entirely new mobile strategy, one specifically geared towards such emerging markets. But of course such a complete and total rethink of smartphone design– one that would seriously incorporate data and cost constraints– takes time, energy, resources, and funds, and selling the phone at $30 means there’s little established mobile players would get in return (at least in the short term).

So it’s really not a surprise to see a new player to the mobile game like Mozilla take up the challenge of breaking the affordability barrier, as the company is able to build such a strategy from the ground up, instead of having to radically alter its current smartphone operations.

“This is a price point currently out of the reach of Google and even the lowest-cost Android handset vendors. It pushes Firefox OS into feature-phone territory, potentially signaling the beginning of the end for the category,” said Ovum analyst Nick Dillon in a statement.

To that end, Mozilla announced at the MWC this week that it has partnered with chip designer Spreadtrum Communications to produce such radically low cost smartphones. “We’re working with them to break through the $50 barrier, which is hard,” Mozilla Chief Technology Officer Brendan Eich told CNET. “This is going to be for a set of [sales] channels inAsiathat do not involve operators,” the carriers that in other parts of the world dominate distribution.

Simply put, while Mozilla’s new phones are “small, underpowered, and short on features” compared with their more expensive Android or Apple cousins, they serve as a gateway into a market that has boundless possibilities, giving Mozilla first crack at the “next billions.”

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