Feature phones see an average share of just 2% in the US handset market but their shipments still remain consistent. These feature phones still have their place in the handset market due to their affordability, simplicity and ruggedness that appeal to various consumer bases. Although smartphones are becoming more affordable, they are yet to match the simplicity and durability offered by feature phones.
Basic phones in a complex world
Smartphones became popular quickly and evolved even faster to embrace new ways to use them to interact with the world, like QR codes, touchless payment and GPS navigation. Although it seems like everyone in the US owns a smartphone, there is a consumer base that is not interested in the specs, or cannot get the hang of the smartphone layout. Such consumers still choose the simple layout of the feature phone which allows them to make phone calls and send SMS messages but lacks all the bells and whistles of a smartphone, like merging data from the cloud and interaction with apps. The longer smartphones are in the world and people continue to live in a digital world, the adoption of smartphones will keep on rising but it will still be a slow adoption and likely never reach 100%.
Feature phones still have their place in market
The consumer base for feature phones has typically been the following:
- Workers in fields that require a tough phone in case of damage (i.e. farming, mining, construction, etc.)
- Criminal use cases to prevent tracking – burner phones.
There are newer use cases for feature phones also. Some consumers may use the feature phone as a secondary device for either traveling (less concerned if the device gets broken or lost) or for digital disassociation/break from the apps, notifications and global connectivity that come with a smartphone. These are much smaller drivers for feature phones than those mentioned above but important to note as large smartphone OEMs like Apple are taking steps to address the concept of digital disassociation through software updates (like the new “focus” feature that allows the users to disconnect from apps/notifications for productivity or just for a break from being connected). These sales would be seen in the prepaid channels and well-known national retailers (like Walmart and Best Buy) along with a temporary SIM card.
Conclusion
Feature phones remain consistent in the US as their simple design, affordability and ruggedness still pander to specific demographics. Although there will not be a significant spike for feature phones in the market, there are consistent needs that create the steady demand for feature phones in a smartphone-dominated market. Prepaid channels will continue to sell these devices to accommodate an affordable and durable option for people who only need a simple device.
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Some quick observations on the feature phone market:
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While the overall market continued to rebound from the ill effects of COVID-19, 5G also continued to grow. Commenting on the 5G scenario, Senior Research Analyst, Harmeet Singh Walia said, “5G shipments continued to accelerate registering a 120% QoQ jump in Q4. The overall 5G smartphone penetration increased to 34% of total smartphone shipments compared to 17% in the previous quarter. The growth was driven by the launch of the iPhone 12 and a strong portfolio of products from brands like OnePlus, OPPO, Xiaomi and vivo in the sub-$300 price band. Also, there was a large pent-up demand for 5G phones, especially within the iOS base. China accounted for ~40% of the total 5G smartphones shipped in CY 2020. Apple’s entry will be a strong influence in driving 5G adoption outside China in 2021.” 
Some quick observations from the feature phone market:
Feature Phone:
