IN: Newer, smarter phones; OUT: Dealers of used handsets

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#1
Amazing statistics! Singaporeans change mobile phones every 12 to 16 months? I think I've used my current phone for nearly 5 years (i.e. 60 months) without feeling a need to change. And penetration rate here is the highest in the world? It seems we are trying to carve out a reputation for being materialistic; in that case we will probably succeed in this respect!

Dec 11, 2010
IN: Newer, smarter phones
OUT: Dealers of used handsets


Mobile lifestyle offered by smartphones a big click with consumers
By Irene Tham

AS MORE people hook up with newer and 'smarter' phones, cash registers have stopped ringing at many second-hand shops.

The falling demand for used handsets has led to dozens of outlets closing in the past year or two, a check with people in the trade reveals.

Market research firm GfK put the 'substantial' drop at about 20 per cent but declined to provide exact numbers.

One casualty is Mr Alex Tan, who used to run a shop in Golden Mile Complex.

'There is no business. Even foreign workers buy new phones,' said the 40-year-old, who closed his shop six months ago after running it for five years.

Mobile Forces, a shop in Toa Payoh Central, said it sells fewer second-hand phones these days. A staff member said blue-collar foreign workers no longer scout for used basic models. Now, it sells premium models like iPhone 3GS, BlackBerry Onyx and Nokia N Series phones.

Changing consumer preferences is seen in the case of Filipino maid Crecilia Ellema, 38. She favoured used phones in the past but paid $75 for a new Motorola model - without contract - three months ago. 'It is cheap so I'd rather buy a new one,' said Ms Ellema, who has been working here for five years.

GfK said a third of mobile phones sold from January to October this year were smart types, compared with 12 per cent in the same period a year ago.

Buyers snapped up more than 553,000 smartphones in the first 10 months of this year, compared with about 221,400 units over the same period a year ago.

These devices have been more popular since late last year, driving ownership to one of the world's highest. About 40 per cent of the seven million mobile phones in use here are smart versions, based on telco estimates.

Users connect with these phones because they can get driving directions, check e-mail, read online news, watch a movie and play games on the go. Their larger screen size also makes surfing the Internet less of a strain on the eyes.

'Smartphones have introduced a completely new mobile lifestyle which traditional mobile phones are unable to satisfy,' said Ms Shirleen Kok, general manager of GfK.

Another big hook is that all three telcos - StarHub, SingTel and M1 - trotted out generous data price plans for all models of smartphones in January this year. Generally, they offer a basic $39 subscription plan with 100 minutes of outgoing calls and 12GB of data usage.

All three telcos have placed a price cap of $30 for any extra data usage, a change from when customers had to pay more - either pay-per-use or via a separate data bundle package.

On average, Singapore residents change mobile phones every 12 to 16 months, said GfK. Research firm The Nielsen Company said the country's mobile penetration rate is 142.1 per cent, the highest in the world. This means that some people own two handsets or more.

The evolving consumer behaviour means remaining second-hand dealers face further disconnection from the market if they do not do anything.

Another pressure they face is high rents, especially so with a buoyant economy. Which is why, to get a lifeline, many have gone into the phone repair business.

One shop in Toa Payoh charges $10 to send customers' defective handsets - which are still under manufacturers' warranty - to the service centres and collect them after repairs.

itham@sph.com.sg

My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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#2
When you see a lot of your tech-goondu frens and colleague blindly jumping on the iphone bandwagon, you can't help but stop and think whether this people really knows what they are jumping into. As the iphones and smartphones uses a lot of apps, its a given that their mobile bills will increase either through higher subscription charge or higher data charge.

So this will probably continue to be a revenue boost for the 3 telcos.
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#3
(19-12-2010, 10:53 AM)lonewolf Wrote: When you see a lot of your tech-goondu frens and colleague blindly jumping on the iphone bandwagon, you can't help but stop and think whether this people really knows what they are jumping into. As the iphones and smartphones uses a lot of apps, its a given that their mobile bills will increase either through higher subscription charge or higher data charge.

So this will probably continue to be a revenue boost for the 3 telcos.

Well, I guess it's because iPhones are one of the most user-friendly smart phones out there, with a sleek and stylish interface which would appeal to most people. Probably I can class it as being "idiot-proof"! But I am always of the view that one should not pay excessive charges just for the sake of owning a smart phone, when a plain vanilla mobile phone will do. Of course, this depends very much on individual tastes and requirements....
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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