Why are domestic mobile phones collectively increasing in price
2024-11-08
In the past month, new domestic mobile phone products have been released intensively. The head of Huawei's terminal department recently revealed on social media that the highly anticipated Huawei Mate70 series smartphones will be released in November. The annual "Double 11" has begun, and with the active promotion of mobile phone brands, the domestic smartphone market is expected to maintain the growth and recovery trend since the beginning of this year. Since the beginning of this year, the domestic mobile phone market has shaken off the downward trend of several consecutive years. According to data from the China Academy of Information and Communications Technology, from January to September, the domestic market shipped 220 million mobile phones, a year-on-year increase of 9.9%. The important reason for the market recovery is the arrival of a new round of replacement cycle, coupled with the launch of new products such as artificial intelligence phones, foldable screen phones, 5G phones, etc., catering to consumer demand and injecting new vitality into the domestic mobile phone market. Generally speaking, the replacement cycle for Android phones is 3 to 5 years. From the peak of the previous shipment volume, it can be seen that the market will enter a new replacement cycle by the end of 2023, and the previously accumulated demand for replacement machines will gradually be released. Meanwhile, a series of favorable policies have also created a favorable development environment for enterprises related to the mobile phone industry chain. Both quantity and price have increased, and the average selling price of domestic mobile phones has also risen. Multiple market research institutions have reported that the average unit price of the domestic smartphone market has significantly increased compared to last year. From the recent release of new mobile phones in the domestic market, the prices are mostly concentrated between 4000 yuan and 6000 yuan. According to International Data Corporation, the market share of high-end mobile phones priced over $600 in China reached 29.3% in the third quarter, an increase of 3.7 percentage points compared to the same period last year. Global research institutions predict that the Chinese market will replace North America as the world's largest single market for high-end smartphones priced over $600 this year. The collective price increase of domestic mobile phones is due to the rise in chip prices. The deep application of artificial intelligence technology in mobile phones has put forward higher requirements for the performance of mobile phone chips, memory, and other components. The latest mobile system level chips launched by Qualcomm and MediaTek both use the new generation of 3-nanometer technology, which significantly improves energy efficiency and artificial intelligence performance. However, the process cost has also increased significantly, resulting in a 15% to 20% increase in selling price. In addition, core components such as memory, screen, and battery have generally increased in price due to technological upgrades, increased demand, and supply chain factors. As the tide rises, the rising upstream costs will inevitably be transferred to downstream smartphone prices. The collective price increase also caters to the strategic demand of domestic mobile phones to collectively layout high-end products. The fundamental reason behind the price increase of chips is consumers' pursuit of higher performance in smartphones. Previously, the domestic smartphone market remained sluggish, and the high-end market showed a trend of counter trend growth. Since the beginning of this year, the high-end market has also been an important factor driving the overall growth of the mobile phone market. Why are phones more expensive and easier to sell? In the final analysis, the smartphone market has entered a stage of transition from essential products to improved products, and consumers are willing to pay for high-end phones that perform better in various aspects such as imaging functions, gaming experience, charging speed, and body materials. At the same time, facing the increasingly saturated mobile phone market and the continuous increase in research and development investment and innovation costs, mobile phone companies can only seek profits and find a way out by laying out in the high-end market. Collective high-end layout means more intense competition. Although high-end phones are good, they are also more expensive, making it difficult for consumers to pay for them. At present, some domestic mobile phone brands still adopt the commonly used method of stacking materials, focusing on improving high-end mobile phone configurations, but have not formed a differentiated competitiveness of "what others don't have" and a brand influence that is recognized by consumers. In fact, judging from some popular and even hard to find models, consumers' enthusiasm for new technologies has never diminished. Only by constantly breaking through new technologies and shaping new advantages can we promote consumers to switch to new ones. Among them, artificial intelligence is the key to winning in the current high-end market. Since the explosion of self generated artificial intelligence, domestic and foreign mobile phone manufacturers have embraced it. Imagine saying to your phone, 'Help me order a large latte with less sweetness and ice.' Your phone can immediately place an order and make a successful payment on the food delivery platform, like a personal assistant. It can be foreseen that with technological upgrades, artificial intelligence smartphones will have smarter voice assistants, better photo effects, more convenient meeting summaries, and other functions, attracting many consumers who pursue technological experiences and driving new growth in the high-end market. (New Society)
Edit：Yao jue Responsible editor：Xie Tunan
Source：Economic Daily
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