Still searching for a mobile phone ...

The comparision of the current mobile phone scenario with the PC scenario of the Late 90s and early 2000s has another dimension to it.

Remember those days, when assembling a computer worked out to be more cheaper than buying one off-the-shelf. This is true to most places, and truer to the developing countries (like India).

The premium being charged was hefty for the branded PCs, and the difference in performance was very minimal.

Due to the integration challenges, assembling of the same kind is no longer possible, but you have another way.

In the current mobile phone market, there are two types of players:

those who build their handset: the likes of Samsung, Nokia, SE, Apple, Blackberry, htc etc.

and then,

those who just put their nametag on it: the likes of  Dell, Acer, most Network Operators, and of course, the smaller players, like Maxx, MicroMax, Videocon, Spice, Karbonn, etc in India.

The first group obviously have a better brand name, and command better pricing power. 

In the second group, those who have a better brand, also do, unlike unrecognized brands.

Let us call the first group as Tier-1 player and rest as Tier-2 players (dark horses).

The lower end of the segment is pretty much commoditized. I wouldn't talk much about that.

Now, let us take a look at the capabilities. What does one expect from a smartphone nowadays:

Processing power: ARM is the preferred choice. So, its just a numbers game on the MHz. If you get a GPU alongside, that adds up to the MHz.

Real Estate: Of course, screen size is a factor. The bigger the screen better. As we speak, the really high-end hand sets are touching 512x800 (SE Experia Arc: 480x854, Lower end: 240x320).

Camera Size: Mobile cameras, because of their form factor, can never compete head-to-head with a stand-alone digital camera. Yes, not even the lower end point-and-shoot cameras. Most of the pictures are used for blogging and sharing. Looking at the real applications, Mpix is never a concern.

There are several other features, that add weightage. Most of them have either become standard, or offer very little differentiation.

• Capacitative Touchscreens are On, and Resistives are on their way out
• Network Capability: 3G handsets  are quite standard. However, in India, network capability lags the handsets quite a bit. 
• Features that have become very standard include GPS, WLAN, Bluetooth, Music Players etc.

Coming back to the pricing power, it works other way for the customers. The dark horses offer an extremely good value-for-money proposition to the consumers.

To compare what is available in the market as of today,

High-end:

- 1 or 1.2 GHz CPU (maybe a Dual core) + GPU

- 5MP camera or a specialized 8MP camera

- 200 to 500 Kpixel screens

Mid-end:

- 500-800 MHz CPU with/without GPU

- 2-5 MP camera

- 100-200 Kpixel screen

In the mid-end segment, there are several handsets from the Tier-1 players. However, there are also a lot of dark horses from the Tier-II players. 

To name a few models, a good model from the likes of  Micromax/Videocon/Spice can give the Tier-1 players a good run for their money. 

Micromax A10 or aSpice Mi310 will beat the Tier-1 phones hands down. Both in terms of performance and price. I am talking about the likes of  LG Optimus one, HTC Wildfire, Dell XCD35 or a lower end Samsung Galaxy (I dont really know how many phones Samsung has under this name. Gosh, they should have atleast half-a-dozen only on this segment)

Imagine two people walking into a store and one buys a higher-priced Dell and other buys an unnamed handset with the same features and performance. It is most likely, that they both come from the same assembly line, and only the name plate differs.

In the high-end segment, obviously, the Tier-2 players are behind the leaders. But the game is about to change. I would say that they are about 3 to 6 months behind the market leaders, or may be more.

Like how it happened in the PC industry, the game is about to change. In about a year's time frame, the CPU horse power isn't going to be a differentiator in the performance. The difference between the mid-end and high-end segments will slowly fade down. 

Are  you willing to bet on the dark horses? I have decided to bet on one.