The last phone that Xiaomi has announced, the Xiaomi 13 Ultra, will not arrive in Spain until next June. When it does, yes, it will surprise more than one loyal user of the brand. Most likely, its price starts at 1,400 euros, much more than what the terminal costs in China.
The price matches the specifications. It is an ambitious mobile, made with premium materials and a camera that comes with the Leica seal and offers a variable aperture, rare in mobile telephony. The figure, however, definitively buries the image of the company as a manufacturer of “cheap” mobile phones.
Although Xiaomi obviously has other phones in its catalog that are much more affordable, in recent years it has begun to increase its prices, betting on more powerful phones with more advanced features.
It is not the only one that is doing it and, together with serious problems in recent years in the supply chain of key components such as processors and memories, it has changed the landscape of low-end mobile telephony, which less than five years ago was incredibly promising.
Before COVID turned the electronics market upside down, it was possible to find quite competent mobile phones under 200 euros. They were not smartphones that could be compared to the latest iPhone or Galaxy, of course, but they offered acceptable features even close to 150 euros. For many users, who were content with a mobile that had WhatsApp and a decent camera, it was more than enough.
Today, 200 euros can be considered the minimum price of a smartphone (except for specific offers), and phones in that range can be counted on the fingers of two hands. Those that are worth it, with those of one.
One of the culprits is 5G support, which started coming to many devices in the pandemic years. The jump to this new generation of wireless communications made it necessary to equip new modems and use new antennas inside the devices, which made the price more expensive.
In the early years it was a feature reserved for the most expensive smartphones, but little by little it has been sneaking into all terminals and although the price of the components has dropped, it has not yet reached the level of the modems and antennas of the latest years of the 4G era.
Unlike other components, manufacturers don’t have many alternatives. A mobile phone can have a slightly worse but cheaper screen or a sensor with fewer megapixels, but there are only two major manufacturers of processors and modems (these components are usually grouped into the same chip), Qualcomm and Mediatek, and their options are limited because their interest is also to sell more expensive processors with better profit margin.
Although there are some phones for sale that do not integrate it, 5G support is beginning to be considered necessary in order to extend the useful life of phones.
For the companies that make these devices, the weather isn’t particularly favorable either. Although some of the supply problems of the pandemic have now been fixed, the mobile phone market is in free fall. In the first quarter of this year, for example, smartphone sales have fallen by 14.6%, according to the IDC consultancy. “The industry is going through a period of inventory adjustment. Manufacturers remain cautious rather than dump more phones into the channel to pursue market share growth,” explains Nabila Popal, the company’s research director.
This forces brands like Xiaomi, who were previously willing to flood the low-end with bargain-priced phones in exchange for growing unit sales, to move to higher price points and with better profit margins.
Another vector that exerts pressure is the renewal cycle. The trick that made it possible for the telephone market to have mobile phones at a knockdown price was a frequent renewal of the devices.
In recent years, however, users have begun to extend this term. On average, in Spain, mobile phones used to be renewed every 19 or 20 months, but today it is easy for phones to last more than two years in your pocket.
After the accidental break, the lack of support for new versions of the operating system is the main reason for replacing a terminal, but both Google and Apple have achieved a level of stability in their platforms that allows mobile phones to function more than acceptable for several years. The changes between generations are no longer as great as they were a decade or even five years ago.
The consequence is that we are increasingly open to buying second-hand, refurbished or older generation mobiles that are still for sale and spending a little more than what we would have considered prudent until a few years ago.
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