Blue wrote on Jun 8, 2016, 12:39:
Beamer wrote on Jun 8, 2016, 11:28:
We don't have substitutes for smartphones.
We don't need any, we already all have smartphones, which is why their growth is falling off. For the smartphone industry to sustain the way it's operated in the past we'd need to find an undiscovered continent/planet of new potential customers.
Yup. And, well, I mean, there is still kind of an undiscovered continent - India is about 25% penetrated, Africa well below that, ha! Of course, the growth there will be in $25 smartphones.
But, what he was referring to, I believe, was all the "PCs are Dead" articles. PCs were dying for a few reasons:
- Technology was stagnating, so there was less need to upgrade and the upgrade cycle slowed
- Prices were falling, so new PCs cost less than the ones they were replacing
- New products were replacing PCs. People were spending their money, and doing their webs browsing, on laptops, tablets, and phones
Some of this is true for smartphones. The technology is absolutely stagnating, as the processing power is insane, but people still want new. The cameras have been increasing exponentially and will hopefully continue to do so, and I still feel like the OSs seem to require that power, even though I have no clue what they use them for (every iOS and Android device I've used feels more sluggish after 2 years than my WP8.1 devices did after that period, but WP8.1 is dead and WM10 always feels sluggish.) At some point the craze to upgrade will die, but we have a while. The bigger concern is that phones went from $200 every 2 years to $700-800 every 2 years, which will slow people down (even though they pay less for the phone in the long run.)
Prices are falling, too. Galaxies and iPhones may stay $600+, but the tier just below flagship is plummeting in price as companies like Huawei enter the market. Now that it's more out of pocket, people will gravitate to the almost-as-good cheaper phones, or to last year's flagship, which is 85% the power for 40% the price.
But, for the substitute, there are none. No device is replacing the smartphone. So, where the PC was losing ground to devices people used for similar things, the smartphone has no competitor right now. It's market may be entering the mature part of the innovation curve, but it isn't in the decline part, and won't be for quite some time.
What remains to be seen is who dies in the mature part of the innovation curve. LG, HTC, Sony, Moto/Lenovo, etc., are all very, very vulnerable.