Chinese smartphones

Lure of cheaper, powerful phones

Chinese handset makers are selling devices with better hardware but at lower prices, compared to phones from top brands

When long-time iPhone user Muhamad Isuandi decided to switch to an Android phone last June, his research for a powerful phone with the best value led him to the US$299 ($426) OnePlus One.

The only problem was the phone, by first-time Chinese handset maker OnePlus, was not sold here.

With a friend's help, the 31-year-old e-commerce sales manager had one shipped in from Hong Kong for $520.

He said it was the "best device" he has ever bought.

The phone's quad-core Qualcomm Snapdragon processor, 5.5-inch high-definition screen and 13-megapixel camera made it comparable to other premium phones from established brands, but at a much lower price.

Mr Isuandi, who started with the iPhone 3GS and stopped at the iPhone 5s, now swears by the Android devices made by the Chinese company.

He is so happy with his purchase that he is undecided about upgrading to the new OnePlus 2, which goes on sale here on Sept 14.

"I want it but even now, after the one-year mark, my OnePlus One is still running well and the battery is still fine," he said.

One thing is for sure.

His scepticism of buying cheaper devices from lesser-known manufacturers is now a thing of the past.

Since Chinese phonemaker Xiaomi launched its first low-priced, $169 entry-level Redmi device early last year, there have been more Chinese handset brands targeting consumers here.

The draw of devices from the likes of ZTE, Phicomm and Lenovo has been their lower prices, which are kept competitive by selling the devices online and cutting out the retail and telco channels.

The draw of devices from the likes of ZTE, Phicomm and Lenovo has been their lower prices, which are kept competitive by selling the devices online and cutting out the retail and telco channels.

Since then, several of the phonemakers have moved on to make devices with better hardware, but still pricing them affordably compared to premium phones from established brands such as Apple, Samsung, HTC, Sony and LG.

For instance, Huawei's latest octa-core powered P8, which has a full high-definition screen, is selling at $699.

The OnePlus Two, which uses the latest Qualcomm Snapdragon 810 processor, is going for $598.

Lenovo's Vibe Shot, which has a 16MP camera, is priced at $479.

Lenovo is also selling its new 6.8-inch Phab Plus ($499) for those who want a bigger phablet phone.

Then, there are the 5-inch Oppo R7 ($569) and 6-inch Oppo R7 Plus ($699).

Both devices share similar hardware, including a Qualcomm Snapdragon 615 processor and an 8MP front camera.

More of such affordable phones with powerful hardware are expected to be available in the coming months, given that Lenovo and Huawei have both announced new premium models at the annual IFA tech show in Berlin last week.

According to research company GfK Asia, the total market share of Chinese handsets jumped to 9.5 per cent for the first half of this year, compared to 2.8 per cent over the same period last year.

Of the 118,600 units sold here during this period, 15,500 were premium models between $400 to $700.

"Previously, the focus of Chinese brands was to penetrate the local market with their entry-level, under-$300 models," noted Mr Gerard Tan, account director for technology at GfK Asia.

"However, more Chinese brands are entering the more 'premium-price bands' with their flagship launches, where the number of models in the $400 to $700 segment grew from four in 2013, to 15 in 2015."

One telco has responded to the rise in subscribers buying cheap smartphones without the subsidy offered in two-year phone contracts. M1 recently announced its new mySIM mobile plans that are cheaper than standard contract plans.

M1's current $41 monthly Lite+ plan, which also offers a subsidy on a new handset, comes with 3GB of data and 200 minutes of outgoing calls. The mySIM 30 plan, which does not have a handset subsidy, offers 300 minutes of outgoing calls and 5GB of data, and is priced at $30 a month for those taking a one-year contract.

"Customers who prefer to buy their own smartphones have told us they would like to see better value in their post-paid plans," said Mr P. Subramaniam, M1's chief marketing officer.

"As we do not subsidise these customers' smartphones, we pass these savings back to them through larger data, call and message bundles," he said.

A version of this article appeared in the print edition of The Straits Times on September 09, 2015, with the headline 'Lure of cheaper, powerful phones'. Print Edition | Subscribe