Disqus
You would think that Chinese phone makers are dipped in gold, having secured contracts with all of the leading brands. However, the truth is somewhat different. From one billion devices they are expected to make this year, companies which make devices will keep just 1%. You got that right – the rest goes to the major companies/brands which actually sell these products to the users (and operators).
To be fair, we did know that modern smartphones make decent margins for companies designing them, but we didn’t know that the production costs are so low. Sure enough, we would have to add shipping & handling, packing, customs and other related costs to get to the real per-unit cost of making a phone in China. Then add marketing, education, software development and you get to the final price that still leaves room for solid margins.
According to China Times, this situation — when companies who actually make devices earn so little — is causing some concern inside the industry, though we can hardly see that changing anytime soon. If Chinese manufacturers aren’t satisfied, major brands can always move their production elsewhere. Like it or not, it’s just the way modern world works…
[Via: Unwired View]
About The Author
Dusan Belic
Dusan has been using smartphones since their introduction and is now following the latest trends in the industry. The "convergence" is what he's most excited about, and writing about it is the next logical thing to do. He thinks that using a smartphone is what everyone who cares about their time should do. In addition to his interests in mobile phones, Dusan also loves to experiment with the latest web and mobile 2.0 services. The idea of accessing and managing your information from any device no matter where you are simply amazes him. Whether it's an online to-do list, note taking service or a video sharing social network, he's there to try it out. He admits though, he's still searching for the ultimate web-based organizational tool, which "sings" perfectly with the mobile PIM application. Dusan used to run SymbianWatch.com which later became part of IntoMobile. He lives in Serbia, South-East Europe, from where he edits the site on a daily basis.
