Long tail of Choice – War of the phones

Posted on Posted in Strategy

Last week, Intex launched a mobile phone for the visually impaired. The phone has features like Braille on the keypad, voice dialing, big keys, emergency sms key, hearing aids (including a torch light!). This after a launch of a series of such phones targeting niche segments like phones for the elderly, phones with insanely long battery life, phones with a projector

As Seth Godin talks in his blog and I quote

            “The mass market is being replaced by multiple micro markets and the long tail of choice.”

All these are products being offered by small players in the market and not by any of the established mobile phone vendors like Sony Ericcsson, Nokia, Samsung, LG, Apple or HTC. As Seth says, that this is now starting on fringes and will spread across fast. Unless the incumbents take notice about this now, it might be too late for them to continue to post the kind of growth rates that they  have been enjoying.

Where all the global players are innovating and fighting the battle for mobile devices on the software and apps, the local players in India are innovating on the hardware.

While the global players are trying to outdo each other on the tablet play, the local players are vying for the local phone market. 

This looks to me like following the classic play – the fringe players start eating into the marketshare of incumbents at the lower end of the spectrum which is not very profitable. So, the incumbents do not mind that much as they start concentrating on the product lines which are highly profitable. Gradually these fringe players become big and they now want a pie of the high margin products as well and so start gaining marketshare in this category and the cycle continues and culminates in a blood bath in the category. 

The only thing could stop the cycle is if the low end segment is completely killed for whatever reason. Though I do not see anything remotely capable of killing the low end segment in the mobile phone industry yet, I do think that could possible rule that out. This space will become even more interesting if that happens.

For now, the Nokia’s, Samsung’s of the world need to be wary of the Intex’s, Micromax’s and the Lava’s of India.  

Do share your thoughts and continue the discussion