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Cost of CDMA handsets continues to fall for entry-level handsets
Posted: 30-Apr-2007 [Source: CDMA Development Group]

[CDG reports wholesale prices for CDMA2000 entr-level handsets continues to decline rapidly.]

Costa Mesa, CA -- The CDMA Development Group (CDG) announced today that the wholesale prices for CDMA2000(r) entry-level handsets continue to decline rapidly -- driven by CDMA industry initiatives, economies of scale, and increased competition -- as more entry-level handset vendors enter the market. Over the past year, up to 35 sub-US$50 CDMA2000 handsets have been introduced into the Indian market from 12 suppliers.

In the latest report on very-low-end (VLE) handsets in India, dated April 6, 2007, the Yankee Group states that in the fourth quarter 2006, there were 17 sub-US$50 CDMA2000 models commercially available from nine handset manufacturers, including two handsets offered for less than US$30. The report also notes that an average selling price (ASP) for sub-$50 CDMA2000 handsets has dropped to $39.29, and the differential between entry-level 3G CDMA2000 and 2G GSM handsets in India has narrowed to within a few dollars. Yet, unlike the voice-only 2G handsets, more than a dozen of the VLE 3G CDMA2000 handsets can access the Internet to download ringtones and wallpaper over the air, and up to three of them have color displays.

With regards to 3G, the cost difference between WCDMA and CDMA2000 handsets remains quite large. Currently, entry-level CDMA2000 handsets are $100-$200 less expensive than low-end WCDMA handsets. This difference, as well as the number of models and suppliers at these price points, represents a significant competitive advantage for CDMA2000 operators around the globe. CDMA2000 represents over 70 percent of the worldwide 3G market.

"In India, the competitiveness of CDMA2000 has enabled 3G handsets to reach price parity with 2G technologies in the entry-level device segment," said Perry LaForge, executive director of the CDG. "Through industry efforts such as the CDG's" 3G For All" campaign that focuses on common handset procurement specifications and aggregated device purchases, the prices for low-cost voice and broadband data-enabled devices will continue to decline, further strengthening CDMA2000's business case for developing markets. Our campaign is not limited to one specific vendor; we are seeing results across a number of vendors."

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