The Realities of a $50 Smartphone

An anonymous reader writes: Google recently reiterated their commitment to the goal of a $50 smartphone in India, and a new article breaks down exactly what that means for the phone's hardware. A budget display will eat up about about $8 of that budget — it's actually somewhat amazing that so little money can still buy a 4-4.5" panel running at 854x480. For another $10, you can get a cheap SoC — something in the range of 1.3Ghz and quad-core, complete with Wi-Fi, Bluetooth, and GPS radios. A gigabyte of RAM and 4 gigabytes of storage can be had for another $10 or so. Throw in a $2.10, 1,600 mAh battery and a $5 camera unit, and you've got most of a phone. That leaves about $9 to play with for basic stuff like a casing, and then packaging/marketing costs (some of which could be given freely, like the design work.) Profit margins will be nonexistent, but that's less of an issue for Google, who simply wants to spread the reach of Android.

Comments

How to make a $50 phone

[OrangeTide]

Design a $100 phone, and don't sell it through channels that will take a cut, and don't tack on any profit for yourself.

Sure, it's a good deal for the consumer, but kind of weird to act like this could be a business strategy or that there is really any new technology going into it. Charging half as much by not taking profits isn't exactly revolutionary.

Re: How to make a $50 phone

[Hardhead_7]

Google wants to make money off advertising. Plus, if they can become the standard in a huge emerging market, that's playing the long game.

Re:How to make a $50 phone

[OrangeTide]

As an original developer for the Kindle, I can say with some authority that I know how zero and negative margin mobile devices work.

Re:How to make a $50 phone

[OrangeTide]

There is no contract with the Kindle. You buy it. You can use it, or throw it away, or whatever. If you use it, you might buy some goods and services with it. That was the gamble with that model. But that was also 6-7 years ago.

I'm not sure if people realized, but the first to generations of Kindle did a little worse than break even, despite their high price. The retail price started coming down once the volumes went up and also the technology around EPD got cheaper too.

Re:How to make a $50 phone

[Vastad]

I wanted to give you an 'Insightful' mod point for making a pertinent comment about modern mobile phone contracts.

But you posted as AC and that would be about as much use as lipstick on a pig.

china has them beat already

[kesuki]

http://www.gearbest.com/cell-phones/pp_226719.html $40 smartphone. it is on sale i realize that but the same website has many smartphones under $50. are they efforts to get Americans to buy root-kitted phones is the only thing i wonder about.

Already running a $50 phone.

[Wdomburg]

I'm actually using a $50 smart phone right now. A Microsoft Lumia 635 that I picked up on Amazon for $49.99 off-contract. Specs are about right - 4.5" 854x480 screen, 512MB ram, 8GB storage, no front camera, 5MP rear camera. It does have a quad-core Snapdragon instead of a Mediatek or Allwinner, but clocked at 1.2GHz, and actually does have an LTE radio and Gorilla glass (the two reasons I bought this instead of the 535, which is newer and has 1GB of RAM).

Know what? It's a perfectly serviceable phone. I bought it as a spare to use while I get the screen on my Moto G replaced, and in a lot of ways I actually like it better. Windows Phone actually runs surprisingly well on modest hardware.

Re:Already running a $50 phone.

[invictusvoyd]

Microsoft should pay you $100 for buying that garbage.

Re:Already running a $50 phone.

[scream at the sky]

Have you ever used Windows Phone 7 or higher?

I bought an HTC HD7 ages ago, my only intention was to learn how to use it, in order to sell it, and then flip it a month later. Greedy commission salesman, and such.

I used it for 2 years, and replaced it with a Lumia 1020 when it died through no fault of it's own, gravity is a cruel mistress.

I cannot stress this enough, I *loathe* Microsoft, I have been a Debian user since 2001, until I bought a Mac in 2012, and I am still using that 1020, daily, because it just works.

No, there aren't as many "apps" for it, but the apps that I give a shit about are all there, web browsing, messaging, maps, email, twitter, facebook. And they just work, easily.

Microsoft got Windows Phone right.

Re:Already running a $50 phone.

[Tough Love]

Microsoft got Windows Phone right.

That may be (or not) but Microsoft's brand has negative value. Nobody buys Microsoft except by force.

Re:Already running a $50 phone.

[invictusvoyd]

IE is just more accepted by web sites everywhere.

They are the kind of web sites I wouldn't visit.

Re:Already running a $50 phone.

[Tough Love]

My wife and I both have Lumia 635s now, neither of us were coerced into buying them. They're refreshingly 'clean' compared to Android phones, and were only $70...

Case in point. Take the same hardware, load Android, stick an LG label on it, and sell it for $150. See, Microsoft can't sell phones, they can only give them away.

The Patent Pool isn't Free

[TechyImmigrant]

That BOM missed the $60 for patent licensing from the 3G pool.

Re:They forgot something

[rainer_d]

And updates.
Oh wait, they don't even get delivered to $500 phones in time.
And few people care.
I bet the car-industry has wet dreams about the status-quo of security in the mobile handset industry:
No more recalls, no more consumer-advocate groups calling them out. No law-suits.

Rocking one now...

[RossGreiner]

... And it works great. Stop buying the bleeding edge Apple 26 or the Galaxy XXIV and you will realize 99% of your apps work just fine on a budget smartphone. It even has removable memory and a card slot. The ONLY negative is a the camera quality is low.

Re:Rocking one now...

[U2xhc2hkb3QgU3Vja3M]

I still prefer my method of getting a free hands-me-down iPhone from family and friends. My current one is an iPhone 4 that had a cracked back. After a bidding war on eBay, I got a replacement back with the tools needed and shipping included for only $2. The funniest part is, I think it's a genuine Apple part because the silkscreen is not level and so it got rejected in QA.

$20 Android 2 smartphone available if you look

[Anonymous Coward]

If you are OK with buying 10 or more, you can get android 2.3.3 phones for $20 each. They come rooted, carrier unlocked, and work pretty well. The main feature missing is no LED flash for taking picture, but everything else is there.

Doogee X5--$50 quadcore 5" HD screen

[Anonymous Coward]

Well, $50 buys a lot especially in the world of Chinese smartphones. The Doogee X5 (http://www.doogee.cc/news_detail/newsId=252.html) will be released shortly, and it will cost $49.99 for the base model. It is surprisingly capable with a Mediatek MT6580 quadcore SOC, 5" HD 1280x720 display, 3G radio, 5 MP camera, etc.. The base model has only 1 GB RAM and 4 GB ROM, but for another ~$8 you can upgrade to the 8 GB ROM version. There's even supposedly a higher-end model that is 4G-capable with a Mediatek MT6735 SOC (a very capable 64-bit model), and though the price of this 4G-capable model has not been revealed yet, it will probably be in the ~$75 range.

Re:Doogee X5--$50 quadcore 5" HD screen

[U2xhc2hkb3QgU3Vja3M]

It doesn't matter if it comes with 4GB ROM or if you pay to upgrade to 8GB ROM. Without flash storage, your phone is useless.

Re:They forgot something

[jiriw]

Possibly these $50 phones will get better security update support than most $500 phones-with-hardware-vendor-goo. Simply because the operating system on these will be provided directly by the operating system manufacturer (Google) and by contract no vendor-goo will be allowed.

My phone got pretty much every update between 4.0 and <current release> and I expect to receive updates promptly for quite some years to come. By the way (if you didn't get enough hints), this phone (and my phone of choice) is a Nexus...

There is only one other significant party in the smartphone market that has the same edge... but the phones they make are too locked down for my personal taste. So I only use those when I have to... at work for testing purposes. (I write app software for both iOS and Android.)

Please, you can buy one now retail

[ealbers]

Look anywhere, here
http://www.ebay.com/itm/Huawei...

Heres a $44 USD phone, same one I bought here in Canada for $49 from walmart.

Microsoft already did it

[Anonymous Coward]

In the 3rd world of USA Walmart! The Lumia 635 is usually less than $50 and quite a decent smartphone, in fact, the only one I use until the 640 came out which is $20 higher and has a display polarizer for sunlight, larger display and a front camera. Did I mention the 635 and 640 are both quad core, LTE devices? Oh yeah, they are.

The OS was right, everything else was wrong.

[Kenshin]

I agree. Microsoft got Windows Phone right. The OS is excellent

They were just years late to the party, decided to go home and change their underwear the moment they got to the party (the WP7 vs WP8 fiasco), found out they didn't actually have any friends (app developers) at the party, and they brought a prostitute (Nokia) as their date.

Re:$5 camera unit

[Kenshin]

That's not gonna fly. People are social, and expect a camera nowadays.

I was talking to someone who ran a photography store, and >90% of the photos they print these days come from smartphones.