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Money to be made from feature phones despite shipments slump

Manny Pham
June 19, 2018

Analysts and leading figures from Alcatel, Doro and RugGear have been mainly positive on the segment’s future

Industry experts and heavyweights have put their backing behind the feature phone segment despite forecasts of slumping shipment figures over the next five years.\

Analysts and leading figures from Alcatel, Doro and RugGear have been mainly positive on
the segment’s future. Although shipments will go down, average selling price (ASP) will increase which will then result in even fewer players in feature phones.

IDC stated feature phone ASP was £28 in 2017 and has increased to £30 in Q1 2018, due to upgrades such as smartphone features, 4G and new operating systems to support the band.

According to IDC feature phones in the UK saw a rise last year shipping 2.6 million units up from 2.4 million year-on-year. CCS Insight forecasts the UK will ship only two million feature phones in 2018, down from 2.4 million year-on-year. Shipments are forecast to drop down to one million units by 2021 according to CCS.

Ovum consumer technology senior analyst Daniel Gleeson said: “In four years’ time feature phones will be almost non-existent in the UK. We’re seeing far too many advancements
in smartphones such as artificial intelligence (AI) and augmented reality (AR).
“That can really hurt that key demographic of seniors that will always want easier-to-use technology, which feature phones provide.”

Alcatel UK and Ireland country manager William Paterson said: “There’s still lots of revenue to be made. The consumer clearly still wants feature phones and the network and retailers still have an appetite for it. I think feature phones have shown an astonishing resistance to the more capable smartphones even in an advanced market like the UK.”

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