On Sept. 15, Google Will Make A Massive Bet Against Apple's iPhone 6 Strategy
Google is hoping to deliver a solid smartphone experience for less than $100.
Google's strategy is to work with smartphone developers in emerging markets and to provide them with up-to-date versions of its free Android software so they can make great phones and low prices. It's the polar opposite strategy of Apple, which is gearing up the release of the iPhone 6, which is likely to cost $700.
The market for cheap smartphones is burgeoning. In the West, smartphones are ubiquitous, but in the developing world, most people don't have them.
It is not just Google moving in on the emerging market for budget smartphones. Mozilla is launching a $33 phone in India. Microsoft has pushed down the price of its Windows phone. Xiaomi and Motorola have been launching smartphones in India too, including the Redmi 1S and Moto E costing Rs 6,999 ($115) and Rs 5,999 ($99) respectively.
The bet here seems to be that in the future, it will feel weird to pay large sums of money for a phone. Generally, the history of computing shows that prices drop over time even as devices become ever more powerful. Eventually, Google and its Android manufacturers seem to be hoping, people will face a choice: $700 for an iPhone or $100 for an Android that does the same thing.
Some people think that Android phones only compete with other Android phones, and that Apple functions like a separate market. In that scenario, Apple is happy to exist as a minority brand as long as the minority it serves remains highly lucrative.
Right now, that strategy is working for Android, too. Apple remains strong in the U.S. where a huge chunk of the market buys iPhones. But in Europe, Android is taking over. In the top 5 European countries, Apple's share is only 7-11% of the market.
Of course, Apple's iPhone 6 is likely to be a huge seller - so after Sept. 9 expect these numbers to change drastically.