Sunday, February 13, 2005

GSM Association Targets 'Ultra-Low Cost' Handset to Expand Global Market

The GSM Association (GSMA) launched an initiative aimed at delivering 'Ultra-Low Cost' mobile handsets, initially in the sub $40 range and later targeting sub $30. According to GSMA estimates, about 80% of the world's population have wireless coverage but only 25 per cent use mobile services.

The GSMA brought together a group of its operator members that serve emerging markets(1) to create critical mass through a special procurement initiative. The operators participating in this stage of the initiative are: AIS Telecom, Bharti Televentures, Globe Telecom, Maxis Mobile, Orascom, SingTel Mobile, Smart Communications, Telenor Mobile and Turkcell. A handset specification and tender was then issued and this resulted in further dialogue with 18 different handset vendors, further to which Motorola was selected.

The initial unit volume target for the first six months, once shipments begin, is 6 million handsets. This equates to approximately 1 per cent of the global handset market. As economies of scale kick-in, this new market segment has the potential to add more than a 100 million new connections per year.


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