One of the common questions we get asked is how well do smartphones hold their price over time and does discounting vary by vendor or model.
When we ran this anlysis recently it came as no surprise that one year after launch the Apple’s iPhone 5s shows the lowest level of retail price decline at just -7%. What was more surprising was that HTC’s One M8 shows the second lowest retail price depreciation of only -11% and closely followed by Microsoft’s Lumia 930 at -17%.
The biggest decline was shown by the LG G3 which devalued by 35% during this time. The Sony, Samsung & LG devices showed very steady price declines of 5-7% QoQ resulting in -27% to -32% over the full year.
Price erosion curves for flagship smartphones available/launched over the past 18-24 months were prepared from PriceTRAX data. Unsubsidised pricing details were compared for the iPhone 5s, Samsung Galaxy S5, Sony Xperia Z3, LG G3, HTC One M8 and Nokia Lumia 930 up to 4 quarters from launch using unsubsidised data for the UK. The data is collected on a weekly basis and the same analysis could be done for any country or globally.
Now it is hard to determine exactly why HTC and Microsoft have used this pricing strategy but a number of theories have been suggested;
- Unlike other vendors HTC really only has one flagship SKU at any one time. So if a consumer wants a premium HTC then the One M9 32GB is the only option.This could allow them to drive global production volumes whilst holding retail price ?
- Another theory is that the Microsoft and HTC devices were launched at aggressive pricing points which do not allow much scope for subsequent retail price declines ?
What do you think is behind the slower retail price declines at HTC and Microsoft ?
To read Phill’s report in full, which also shows how he calculated his results please click HERE (short registration maybe required).
Stephen Entwistle
Many leading suppliers use PriceTRAX to track and compare smartphones, mobile phones, tablets, wearables and dongles across 400 carriers and retailers in 43 countries.
Weekly updates to unsubsidised, pre-paid and post-paid contract pricing across retailers and operators are presented in a comprehensive and easy-to-use web interface. See PriceTRAX in Action HERE