Why Budget Phones Are Good, Even for People Who Don’t Buy Them

When 2007 came along and the first iPhone was released, it was a very exclusive type of phone. Only a segment of the population around the world was truly willing to shell out so much cash for a phone that quite possibly could turn out to be a flop. Apple eventually became the company known for trailblazing the smartphone revolution, and its reputation just stuck.

Even now flagship phones released by well-known brand names continue to be expensive. The saving grace of penny pinchers the world over is that there are hundreds of “budget” alternatives from lesser-known brands that have consistently decent levels of performance for the vast majority of users.

Here’s the kicker, though: although people who buy budget phones experience a direct benefit in the form of having a cheaper device with high performance, this purchase also benefits people who exclusively buy the more expensive flagships.

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It may seem like a no-brainer: you’re a manufacturer and you make very cheap phones, so you just sell them and a bunch of people will pop up with their wallets open, ready to satisfy their need for a smartphone that doesn’t cost more than their left kidney. But this isn’t how the world really works.

If you are a budget phone buyer and wish to know who these manufacturers are really competing against, look no further than the phone you have on you right now. They must convince you that their device is worth more to you than the one you currently possess.

Flagship manufacturers like Samsung and Apple don’t have to deal with this as much, since most of their loyal and affluent customers willingly purchase a new device simply because it’s “the next big thing.” Simply add some performance enhancements and a few new features, and you can almost reliably predict how many units you’ll ship out on the first week from release.

A budget phone not only has to compete with your old phone (and that is if you are even convinced that your phone is “old”); it also needs to compete with other companies that offer a similar product. For this reason some go out of their way to grab your attention, like Alcatel did when it released the IDOL 4S with its VR headset. Lots of these manufacturers will simply implement features found in fancier phones and release them at a more affordable price.

Now that we got this out of the way, we can get to why flagship purchasers also benefit from these changes.

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Some of the people who reliably buy expensive phones will sometimes let their eyes stray in other directions, looking at cheaper alternatives to find out if something attracts their interest. This doesn’t happen extraordinarily often, but big manufacturers like Apple, Samsung, HTC and ASUS are surely aware of this trend and need to get an edge over their budget counterparts if they want to keep these folks purchasing their phones. When they do this the first instinct is to boost performance significantly and add unprecedented features (like eye tracking, facial recognition, or a cleaner, more user-friendly interface).

Because the bigger fish are constantly trying to keep themselves ahead and make their phones worth the large purchase (at least from your perspective), they will also indirectly push the limits of what a smartphone could do. This mentality leads to a very interesting – if not beneficial – innovation cycle.

What makes this perpetuate itself even more is that budget phones will constantly catch up to their flagship counterparts to keep themselves competitive, like a stream of lava that is constantly rising, ready to eat up your market share at a moment’s notice.

Ultimately, the person who wins the most out of this affair is you, regardless of what kinds of phones you like to purchase!

Do you habitually buy flagship phones from the most recognized brands? How did you make this decision? Let us know in a comment!

3 comments

  1. My LG G2 Mini has finally died on me, so I replaced it with an LG Q6. I am content with midrabge phones as long as the lag is tolerable and has decent battery life. I don’t game with my phone aside from the occasional NBA Jam or Angry Birds.

  2. I am always amazed at how much people are willing to pay for an Apple product. The iPhone X is the latest example. I personally would never buy Apple, not since Steve Jobs declared open source platforms the enemy, but why would anyone pay $1000 for a smart phone? I am quite happy with my Moto, a discounted phone from Amazon, whose ads I had no trouble disabling.

  3. Over $1,000 for a new (cr)Apple iPhone? Must be kidding… I read an article recently which showed that the actual components of an iPhone (not the body the working bits) was in the region of $US8-90. Yep, you read that right. Add in say $US40 for the case, screen etc. and it just shows up how much markup (cr)Apple is foisting onto the gullible financial idiots of today.

    And… Samsung, LG, Sony et al, are no better. They all charge an arm and a leg for their disposable in 2 years “quality” phones.

    Total rip off.

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