Australians are paying too much for the latest technology and gadgets, according to Chinese communications vendor, Huawei.
The company entered the local consumer market late last year and has been heavily pushing its mobile handsets and more recently tablet devices.
Earlier this week, it launched a Google Android OS-based smartphone, IDEOX X1, with Optus with a retail price of $99.
Last year, Huawei released the $159 IDEOS U8150, which was touted as the cheapest Android smartphone in the Australian market at the time.
The vendor is going down the budget route to gain significant marketshare in the handset space and has set an ambitious goal to be one of the top five handset vendors in the world in less than two years.
Australia is a core market for the company, according to Huawei head of marketing for devices, Mark Treadwell.
While Australians have a huge appetite for smartphones and other portable gadgets, the cost of to acquire the latest technology in the country is too high, he said.
“In Australia, and in a lot of other markets, high pricing has been commanded of the latest technology and we don’t think that is right,” Treadwell said. “We are focusing on the producing the most affordable devices without compromising on specification and features.
“Because of that, our target market of 25 year olds and under that potentially hadn’t been able to afford the latest technology will be able to do that.”
Entry-level is a good place for Huawei to work in, particularly when the company’s devices division is still in its infancy, according to Treadwell. But that doesn’t mean it has no plans to eventually move up the ladder and into the high-end market though it all depends on just how successful the vendor becomes in the handset space.
“Realistically, for us to go out and go head up against some more of the established brands would take an awful lot of investment,” he said.
Having seen Nokia’s fall from being one of the biggest players in the mobile phones industry to a lagging giant, Treadwell saw Huawei’s ‘new kid on the block’ position as particularly advantageous.
Survival in this challenging and busy marketplace will depend on a company’s understanding of its consumers, market conditions and an ability to adapt to change, he said.
“That might be at Nokia’s detriment because it hasn’t shifted and are relying on its existing platform,” Treadwell said. “But we are a smaller player with a kind of a challenger mentality so we have that flexibility to change if the market changes.”
Spurred by the release of the Apple iPad, the buzz around tablets really picked up last year with a number of vendors hopeful of rapid take-up rates during the 2010 Christmas period.
But the hype of a tad premature, Treadwell claimed.
“Last Christmas was counted as ‘the tablet Christmas’ but to be honest it was too early for that,” he said. “While early adopters were fully aware of tablets, the mass market just wasn’t up to speed with it.
“This year will be the tablet Christmas.”
Huawei has already made a play in the tablet space and recently released its 7-inch Android Honeycomb 3.2 tablet with a dual-core processor, the MediaPad. The objective for the vendor, as with its handsets, is to make these devices affordable without sacrificing features.
“We feel 7-inch is the best experience on a tablet because of the portability factor,” Treadwell said.
A number of tablet vendors, including Apple, have favoured a 10-inch design to offer a more robust multimedia experience. But Huawei views 10-inch tablets as edging too close to being a laptop replacement while 7-inch is the happy medium between a smartphone and a netbook.
Huawei continues to look at the 10-inch tablet space but prefers the 7-inch format as a portable multimedia device.
“The tablet is an interesting category since it is one that the industry created as opposed to a product with a succinct need to fulfil,” Treadwell said. “It will be interesting to see how it all plays out: Whether the expected uptake is there or whether there will be more of a split category between 7-inch and 10-inch.
“Maybe one will survive and one won’t.”