One of the reasons why Android has become so popular when you look at it from a market share perspective is because of hardware choice. Consumers can choose a top of the line Android phone selling for $300 on contract or lower range handsets that can get as low as $30 or even free. Does the value of that initial investment remain long-term? A study by wireless services firm WDS says no.
The problem mainly resides within the hardware – It’s just not good enough. Unlike Apple and Research In Motion, Google doesn’t get to make the hardware that houses its Android operating system. This ends up being a good strategy to gain market share and awareness, but it can be poor for device quality, especially over an extended period. Putting Android into cheaper devices is costing global carriers up to $2 billion in repairs, the report said.
People very easily grasp low prices shoved in their faces like an Android smartphone for $50 or $30 with a two-year contract, but it’s a lot harder to realize how much that phone will have cost them once the two-year contract is up. VP of Marketing at WDS, Tim Deluca-Smith points out: “While this price point sounds very attractive, when you look at a total cost of ownership its a different story.”
Apple is a fine example of this concept, pricing the iPhone 3GS at the low, low price of free with a two-year contract. Carriers are reporting unprecedented demand for it.
True, it’s a steal up front, but after months of data and messaging fees, the original savings aren’t that much by comparison. Now take into account the Android hardware failures. Returning devices cost carriers 80 British pounds on average for replacement or repairs and other fees. This isn’t good for carriers because everyone knows they’re as greedy as can be, and not good for consumers either because they have to go through the tedious process of replacing their crappy phone.