Monday, May 19, 2008

Dont forget the Feature Phones!

Lost in the building fervor over the raft of new smartphone devices expected over the next six months (3G iPhone, Blackbery Bold, HTC Diamond, etc) has been the absolute onslaught of new high-end non-smartphones (or "feature phones")from LG and Samsung. This is a definite mistake as the unit volumes of these handsets are likely to be absolutely huge and have as much impact on marketshare for both the semi and handset players as the upcoming smartphones. The Samsung Soul has hit the market to rave reviews and the LG Secret is getting similar early press before its launch at the end of the month. Both these devices, as well as others such as the Samsung F480, pack in 5 megapixel cameras, touchscreens, user friendly interfaces and top of the line display technologies into some very hot form factors. It is these devices that are driving Samsung and LG's share gains as well as the continuing momemtum in Qualcomm's chipset business.

The question is when Nokia/SE/Motorola will manage to respond. The current announced products from those vendors for the 2nd half of the year simply dont measure up to what LG and Samsung are putting on the market right now. The combination of these feature phones and the newcomers to the smartphone segment present a serious challenge to the high-end shares of the current market leaders. Both TXN and Nokia are bouncing today on an upgrade from SSB, but I must say I'm not optimistic about their prospects in the 2nd half.