Sunday, March 23, 2014

Editorial: Local Devices At Premium Price, Acceptable Or Not?

Editorial: Local Devices At Premium Price, Acceptable Or Not?
Editorial: Local Devices At Premium Price, Acceptable Or Not?

Let us start with some history, local mobile brands started with just basic phones with dual SIM capability, then, some features were added such as camera and Analog TV. Later on, they offered touchscreen phones with WiFi and other connectivity and after several months they came up with Windows Mobile followed by Android smartphones.

With the vast amounts of devices that swarm the Philippine market, none of the so-called "local manufacturer" have their own manufacturing plant. They just got their products from manufacturers abroad, such as in China. Some were bought from ODM and carefully configure it, some don't give much effort and just do "re-branding."

So what does it mean? Their device cost is majority driven by how much they bought it. It is like they just became a mere distributor, of course, other expenses are added to the overall cost, but the point is, they buy it abroad and sell it locally. We can say that the local SRP is equivalent to the cost of the device + expenses + company profit + distributor profit. Example, a Php1,000-device could cost as much as Php2,000 or maybe even higher.

But, how about the quality and after sales support? Let us talk about the quality first, we know the fact that those with BIG names protect their reputation at all cost. Why? Because one wrong step could cost them millions of dollars. So what they do is they adhere to a very strict quality assurance procedure to ensure that their outputs are rigorously tested - from raw materials, component parts to the finished products. Do you think that the manufacturers where local mobile brands get their products have these kind of quality?

One more thing, (again) most, if not all, local branded devices does not have Specific Absorption Rate or SAR, this is the measure of radio frequency (RF) energy absorbed by the human body when using a mobile device. This basically means that these handsets are not properly tested or certified to be safe for use, most probably to save cost.

Then comes the after sales support, all local brands have their own service center, some even made a partnership with existing service provider. But, is it enough? We all know that those service centers are limited only to a few. Not only that, spare or replacement parts are mostly not readily available and usually take several days or even weeks to arrive. What's more frustrating? To know that you need to pay for those part/s because the warranty only covers their "service."

How about the software support? How many of the local brands, have actually fixed bugs on their devices? How many have updated their OS version, let says Android 4.2 to 4.3? Let us face the reality that most of their devices are stuck with its software right from the very beginning.

Those factors mentioned above are some of the reasons why local mobile companies can keep their device's price affordable. Cheap smartphone or tablet with great specs is what drives craze to local consumers. However, affordability is starting to fade on the flagship level, some devices in this category are already priced where most Filipinos think premium or expensive.

Many of us will ask, why the price is so steep. Do they have the justification to do so? The answers vary from person to person, most reactions we heard are on the negative side, but some say it is just fair, since the specs are top-tier. 

With all the thoughts given above, are we ready to accept premium pricing for local branded gadgets?

1 comment:

  1. local brands have all the right to step-up pricing of their flagship devices, syempre profit nila yan, question is, may tatangkilik ba? premium price is already tapping a different market segment, sinong bibili sa kanila do'n? a market where branding, software and after-sales support really matters. If I have to spend 17k and more for a smartphone, I'd rather choose sony, huawei, samsung, and other big names, anyway at this price, wlang masyadong pinagkaiba sa performance sa octacores, may lte pa..



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