Microsoft unveils $50 smartphone Samsung Focus Flash
— -- Microsoft on Monday took its turn driving down the purchase price of a smartphone by unveiling the $50 Samsung Focus Flash as part of a publicity event in New York City.
Last month, Apple dropped the price of its 2-year-old iPhone 3GS model to zero (with a contract) to better compete against Google Droid models available since spring for $79.
Google, Apple and now Microsoft are moving aggressively to expand the market beyond technophiles willing to pay top dollar for the trendiest phones.
"Turns out about 70% of the folks in the U.S. haven't taken the leap to a smartphone yet," says Greg Sullivan, senior mobile communications manager at Microsoft. "Over the next few years, hundreds of millions of new smartphone users will come on board, especially at attractive prices like this."
Smartphones take photos and video and can do nearly everything a laptop does. They typically sell for $199 to $500.
Researcher IDC says the global smartphone market will rise 49.2% this year, with more than 450 million units shipped, compared with 303.4 million in 2010.
Microsoft currently holds about 2% of the global smartphone market and less than 6% of the U.S. market, despite spending billions over more than a decade on Windows cellphones. Last year, the software giant abandoned the clunky Windows Mobile operating system, and built a new one from scratch, called Window Phone 7.
On Monday, the company unveiled a six-story-tall smartphone near Macy's in Herald Square to juice up excitement about a new line of Mango OS handsets arriving on store shelves in the U.S.
Microsoft is touting the ability of the $50 Samsung Flash Focus; it incorporates a cutting-edge touch system for calls, texting and social networking. And it can directly access Xbox Live and work with Microsoft Office documents.
IDC analyst Al Hilwa cautions that Microsoft, Apple and Google must be careful not to cheapen the cachet of smartphones.
And Gartner analyst Michael Gartenberg notes that retail price is only one consideration. Smartphone data plans typically run $80 or more a month. "Any consumer who can do arithmetic realizes that the cost of a smartphone over two years, when you add in monthly service fees, is far more than $50," he says.
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