Dell shifts focus towards emerging telecom markets including India

Telecom Lead Asia: In order to implement its new mobile
strategy, Dell has stopped selling its smartphones in the U.S market. The
company will now be focusing on emerging markets including India and
higher-margin products.

 

The smartphone exit comes just a few months after Dell
stopped its enterprise-focused Dell Streak, an Android-powered device. The
company has been vying with the smartphone majors such as Apple and Samsung,
and has failed to strengthen its market share in the U.S market space.

 

The company has stopped its last standing Venue and Venue
Pro smartphones. Additionally, it announced that no replacements will be given
now onwards. Its Venue smartphones were offered with Google’s Android and
Microsoft Windows Phone 7 operating systems. The company had also discontinued
the Streak 5 and stopped selling Streak 7 late last year.

 

However, the company will introduce more mobile products
in the U.S. later this year.

 

For the last quarter, Dell‘s
revenue from the U.S market decreased 3 percent. Bad performance in the U.S
market could be the main reason behind its exit from the smartphone market.

 

However, Dell continues to sell smartphones outside the
U.S. It sells the Venue Pro in India, the Venue in South Korea, a Streak
smartphone in Japan, and Streak smartphones and tablets in China. The company
also offers Streak tablets in some other countries.

 

The company’s new mobile strategy bets high on emerging
markets, such as India and China. In India, smartphone penetration is still
very low and consumers are ready to upgrade their feature phones with
smartphones, hence, the there is good business opportunity for Dell.

 

Dell is not the only company, which has shifted its focus
in terms of target markets. Research In Motion (RIM), maker of BlackBerry
smartphones, has also changed its mobile strategy. RIM has been suffering from
dipping handset sales and PlayBook failure; therefore, it recently slashed its
smartphone and PlayBook prices for the Indian market in order to cement its
market share.

 

For Q4 2011, Dell’s Asia-Pacific and Japan revenue
grew 10 percent including 15 percent growth from China, while EMEA region
posted 8 percent increase. Revenue in the BRIC countries increased 10
percent in the quarter and 15 percent for the fiscal year.

 

Earlier, Andreas Diantoro, Dell Managing Director, South
Asia and Developing Market Group said that the company’s strategy is to focus
on the population that signifies the buying behavior. And, they usually reside
in emerging markets.

 

Dell is also moving to higher-margin consumer products
by discontinuing netbooks and putting more emphasis on its premium
XPS line of PCs. The company is ready to push the reset button on its tablet
and smartphone business after many missteps.

 

According to the analysts, Dell wasn’t putting much force
behind its mobility business and was sending mixed messages around products and
operating systems. Dell could focus on Microsoft’s upcoming Windows 8 OS for
tablets and might be better off reselling third-party smartphones. That could
save development costs and give Dell more flexibility with its offerings.

 

Danish Khan
[email protected]

 

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