Phone Makers May Reduce Fragmentation

Smartphone-Samsung-GalaxyIIThe sheer diversity of mobile devices has posed a serious design challenge and cost to both media and marketers for over a decade. Some of that fragmentation may be easing in the coming year. According to the trade news source for the electronics supply chain in Asia, DigiTimes smartphone makers appear to be  poised to reduce the number of models they will introduce to market in 2012.

The site reports that HTC, Research in Motion, Sony and Motorola Mobility are likely to focus their development and marketing efforts on select releases in an effort to realize greater economies of scale and amortize development and marketing costs across a smaller line of offers. The shift in strategy will also give the manufacturers better control and scale of the raw materials involved in making these advanced phones.

This all sounds a good deal like an Apple approach, and DigiTimes sources say that other handset manufacturers are taking Apple’s success to heart. Apple famously maintains high margins on its iPhone product largely because it has tight control over the materials supply and pricing throughout the chain. They achieve this level of control in part because of the massive sales that individual models achieve. Samsung has been following suit, focusing this year on select flagship models like the Galaxy II S. DigiTimes reports that the iPhone can achieve up to 30 million unit sales in a quarter, while Samsung’s marquee handset sold through 10 million in six months.

For marketers, the implications of a less fragmented mobile ecosystem are varied. Media and marketers have always struggled with the development and support costs of a highly fragmented mobile world. In the days of the feature phones, literally hundreds of different models were in market. “Porting” costs for a game or app could double development budgets. Smartphones helped alleviate that strain somewhat, if not entirely.

One of the advantages of the iPhone’s arrival in 1997 was that it gave media a single target for which to develop. Android gave us two, and RIM/BlackBerry three. But the diversity of handset screen sizes, display ratios, versioning of the Android, and introduction of tablets have ensured that fragmentation remains a problem. Marketers should welcome any reduction in the number of devices in market they need to target. 

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