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CDMA2000 entry-level phones leading the way in India
Posted: 26-Jun-2006 [Source: CDG]

[CDG reports 21 CDMA2000 phones priced at less than $50 from 10 different suppliers are currently available in India.]

Costa Mesa, CA -- The CDMA Development Group (CDG) announced that there are 21 CDMA2000(r) phones being offered for less than $50 USD (wholesale) from 10 different suppliers in India. This compares to only 18 GSM handsets being offered for less than $50 from 5 suppliers. The low-cost CDMA2000 handsets provide access to downloadable value-added services, while the GSM low-cost handsets, as 2G devices, do not. Since the beginning of 2006, CDMA2000 handsets have accounted for as much as 60 percent of all entry-level (sub-$50) handsets imported into India on a monthly basis. And, for more than six months, the difference in the average wholesale price of CDMA2000 and GSM phones being sold below $50 in India has been $1.00 to $4.00 USD. During the same period of time, less than 5 percent of the handsets purchased in India were supplied by the GSM emerging-market handset initiative. The findings of this market study show that CDMA2000 is leading the way in offering subscribers more value and doing a better job at fulfilling the demand for entry-level handsets to price-sensitive consumers in India.

The response of the Indian market towards the purchase of CDMA2000 handsets has been very positive. Today, about one-third of the more than 100 million wireless subscribers in India use a CDMA2000 handset. In March of 2006, CDMA2000 handset shipments into India surpassed those of GSM for the first time. One reason for this increase in shipment volume is due to the larger selection of affordable devices from more suppliers across the entire CDMA2000 product portfolio, and their ability to meet the diverse needs of most Indian consumers. According to the Yankee Group, when considering the entire portfolio of low and high-end devices that were available in India during April of 2006, the average wholesale price of all CDMA2000 devices was $35 less than GSM.

As a result of this intense competition, the price gap between entry-level CDMA2000 and GSM handsets shipped into India has narrowed significantly. Market data now shows that CDMA2000 and GSM handsets are equally competitive at the low end. "CDMA2000 low-cost handsets have approached price parity with GSM and are more affordable than GSM handsets across the entire product portfolio," said Perry LaForge, executive director of the CDG. "These competitively priced devices will enable operators to more effectively address the entire market."

Recent market studies have confirmed that consumers want to do more with their handsets than just make simple voice calls and send short messages. John Jackson, director of wireless/mobile technologies at the Yankee Group, who led the Yankee Group ultra-low cost handset study states, "It is clear that consumers want affordable phones that offer value, not necessarily the cheapest phone. Consumers associate value with brand affinity, quality perceptions, and performance expectations. In this regard, the low end is no different from the high end. Therefore, the lowest priced handsets may actually drive consumers away. In markets such as India where PC penetration is nominal, the data-capable handset will define the Internet experience for a massive numbers of end users."

"Affordable data access using solutions such as BREW(r) are catalyzing value-added service consumption by allowing users to download ringtones, wallpaper, games, news, daily prayers, and eventually Bollywood video clips. In the long term, exposing users to an enriched customer experience and exposure to advanced data services will enable operators to sustain revenue and profit growth," added Jackson.

CDMA2000 offers a larger selection of fixed and mobile devices to address the diverse needs of individual markets and different market segments than any other advanced wireless technology today. Based on current market data, CDMA2000 is leading the way towards addressing the rural market segment in the most price-competitive mobile communications market in the world -- India.

The CDMA industry is working on several initiatives to further reduce the cost and accelerate availability of entry-level devices, as well EV-DO mobile broadband and WorldModeTM global roaming devices. CDMA2000 is becoming the 3G technology of choice for rural markets.

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