There is always room for new players in a dynamic and growing market, and South African consumers can expect to see the smartphone war heating up into 2015, with low-cost devices being the ammo of choice.
This, say industry experts, comes as the local smartphone market continues to thrive as device and data costs come down and the app culture becomes more pervasive among local consumers.
And Taiwanese technology brand Asus may be about to try its hand at penetrating the ripe South African market. Asus country manager Jeff Kuo says the company is assessing the local market to determine viability and demand.
He says, in markets in which Asus has launched its smartphone offering ? the Zenfone range ? it is doing "remarkably well" and, while there are no immediate plans to bring smartphones to SA, Asus is continually assessing the landscape.
Last week, the company said it had earmarked SA for growth, saying it intended "building on the foundations it has laid in the 10 years it has been in the country" and that it aimed to disrupt the local market.
Local opportunity
Looking at how Asus might fare in SA's highly competitive smartphone market, analysts say Asus' entry would make sense, with the low-cost device segment presenting the greatest opportunity.
According to World Wide Worx MD Arthur Goldstuck, there were 16.3 million smartphones in use in SA at the end of 2013. While this was originally forecast to grow to about 18.1 million by the end of 2014, he says, the acceleration of growth this year suggests it could beat the 20 million mark - a penetration increase from 30% to 40% in just one year.
Asus is mainly known for gaming and motherboards, although it has more recently made a mark in the laptop and tablet segments. According to Kuo, Asus is seeing 100% growth in its laptop business in SA. Asus has about 5.3% market share in the SA laptop segment - where IDC ranks it number five in the country.
Asus product manager Bennie Budler says he sees "the affordable segment of the market" as the greatest opportunity for growth in SA. "Asus tablets are well priced for their specification, and we're confident that they're going to disrupt the local market."
BMI-TechKnowledge analyst Clinton Jacobs says, while it is hard to say at this stage what stance Asus would take locally, leading from the company's position in the notebook market ? and having the reputation of being the manufacturer of last year's Google Nexus 7 - Asus could do well with a phablet play, particularly if it comes in at a good price point, while also covering the other size categories.
Ovum analyst Richard Hurst says, while new entrants could find the local smartphone market "tough", given the pool of established players in the country, they will find a market for their devices and market share may not be necessary to prove a solid business.
Goldstuck says Asus does not need to gain massive market share to be successful in a fast rising market. "Even [selling] a few hundred thousand units could represent a solid business. The iPhone is unlikely ever to reach 10% market share in SA, but no one will claim it has failed here."
As for the smartphone war, he says this is now more of a smartphone steamroller that is flattening all before it. "The manufacturers that have been prepared for it are seeing massive sales in segments that were previously feature phone markets, so for them it's not yet about getting market share, but rather about meeting rising demand in their own rights."
Kuo says Asus is working hard to build relationships that will pave the way for more of the company's technology to enter SA. He says it is working closely with technology partners such as Intel and Microsoft SA.
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