Life Tech The surprising phone rival to Apple, Samsung
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The surprising phone rival to Apple, Samsung

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Australia’s third best-selling phone brand after Apple and Samsung is Alcatel, a Chinese-owned company winning over prepaid customers with affordability.

Almost one in every 10 phones sold in Australia between October and December last year was manufactured by Alcatel, putting it comfortably in third place with 9.2 per cent market share. That’s up from 6.9 per cent market share in July-September 2015.

While the premium iPhone easily dominated in first place with 47.3 per cent of sales over that period, the Chinese company had almost half the share of Samsung (22.2 per cent), as reported by research firm IDC.

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The estimate took into account both smartphone and ‘dumphone’ sales, with Alcatel placed third for smartphones and second for dumbphones. Overall, the company’s closest rivals were Telstra (5.2 per cent market share), Microsoft (3.5 per cent) and Huawei (2.8 per cent), according to IDC.

Alcatel’s managing director in the Asia Pacific region, Sam Skontos, acknowledged that many Australians would be surprised by the result. He attributed the brand’s rise to their presence in all major stores and an exclusive focus on prepaid customers looking for cheaper phones.

“The reason why a lot of people probably don’t know Alcatel is because we are a specialist prepaid company, so we operate in purely the prepaid market,” Mr Skontos told The New Daily.

“If you’re talking about people that are budget conscious, people who don’t want to get on a contract, they will know us.”

Here’s how Alcatel promotes its Idol 3:

When the company first entered Australia seven years ago, their phones were only stocked by retail chains like Dick Smith and JB HiFi. Now, the phones are also sold by the big three: Telstra, Optus and Vodafone. This blanket store coverage helps explain why it is beating the more recognisable brands of HTC, LG, Motorola and Sony, which according to IDC could only muster a paltry 5.4 per cent market share – half that of Alcatel – in the last three months of 2015.

Two experts told The New Daily that Alcatel’s biggest selling point is affordability. For example, its most expensive phone, the newly-released Idol 3, is approximately $379. Others in its range, such as the Go, Pop and Pixi, sell for less than $200.

alcatel
Alcatel’s new flagship Idol 3 is helping the Chinese phone maker gain market share. Photo: Alcatel

Phone comparison expert Jo Hanlon of WhistleOut said other Android competitors foolishly try to compete with Apple and Samsung for on-plan customers, while Alcatel is focussed solely on the bring-your-own-SIM-card market.

“Compared with the other smaller players, say Sony and LG, their focus is a lot sharper than the other brands, who are trying to compete with Apple and Samsung,” Mr Hanlon said.

“Alcatel does a really good job of making a phone that looks it has everything you need while keeping the cost way, way down.”

Angus Kidman, tech expert at comparison website Finder.com.au, said the Chinese manufacturer is also taking advantage of recent smartphone converts who are gradually swapping their simple Nokia-style handsets for cheap Androids.

“We’re still at the very end of the transition period,” Mr Kidman said. “There was still a point where people were still buying dumbphones. They weren’t interested in having all those other [features] and were still getting a Nokia or Nokia equivalent – what I often call a post office phone. But I think we’ve hit the stage where people get themselves a smartphone even if they’re not intending to use it in a smart way.”

Another possible factor in Alcatel’s successful transition from retail outlets to telco stores was savvy marketing. It shunned mass marketing in favour of sponsorship deals with the AFL Giants, NRL Rabbitohs, Newcastle Jets FC, the National Basketball League and Iron Woman Tara Coleman.

A spokesman for research firm IDC, which independently estimated market share, said Alcatel is likely to cement its position in third place into the future.

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