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Analysts predict tough time for Google’s Pixel 4 in SA

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Google smartphones may find it tough and competitive to penetrate the local market, say analysts in reaction to the newly-launched Pixel 4.

According to the analysts, Google’s smartphone strategy “is not really about mass market scale but to focus on flagship phones”.

The Internet giant this week unboxed its Pixel 4 smartphone and other hardware devices at the annual Made by Google event.

The Pixel 4 is powered by Android 10 and starts at $799 (R12 000).

It has not been confirmed if and when the Google Pixel 4 will be available in SA.

Arnold Ponela, research analyst for mobile devices and image printing and document solutions at IDC, says pricing is key to win market share in SA, where competition is very tough and global brands have established market positions.

“This makes it difficult for them to compete with market leaders – Samsung and Huawei – as they have models in all price tiers. Samsung and Huawei’s high-end models continue to create a strong affiliation for the mid to low-end models, which are supporting their overall shipment performance.”

Ponela believes Google has failed to distil a value proposition for South African consumers. “The challenge is that its phones are a bit expensive so most people cannot afford them.

“For Google phones to succeed in a price-conscious market like South Africa, it would need to be top-notch in its specs, and stand head and shoulders above other powerful Android smartphone brands. The company should price its new Pixel phones more aggressively, and should attract consumers to switch over with a new, attractive and viable trade-in scheme.”

Otherwise, South African consumers are willing to stick to affordable premium phones that are not beyond their financial reach, he notes.

Operator partnership

According to Ponela, the South African smartphone market is dominated by phones that are below $100 (R1 000) and to achieve this, it’s important to partner with the operators.

He explains: “Currently, Google’s cheapest smartphone (Pixel 3a) is selling at $399 (R6 000) which is way above the $100 mark. If the Pixel 4 was to launch in South Africa, it would compete against the top-selling flagships like the Samsung Galaxy S10 Plus and the Huawei P20 Pro.”

Furthermore, he says Samsung has invested a lot in trying to grow its customer base and it appears as though iPhone customers are more loyal.

Ponela adds the South African smartphone market is tough and competitive, and local brands are currently going through a difficult time.

However, he notes the ongoing US ban restricting Huawei from using Google services and apps means Huawei won’t be able to offer customers access to apps like Gmail, Google Maps, YouTube and, critically, Google’s app store.

“The technology company’s announcement that their new flagship, the Mate 30 and Mate 30 Pro, would not be launched in South Africa has left a vacuum that Android phones like the Pixel 4 could take advantage of.”

However, he cautions that Google’s lack of relationships with operators in SA could make it tough for it to challenge Huawei with the Pixel 4.

“In South Africa, operators are very important for making expensive flagship phones a success because they offer fixed-term contracts with monthly payments that often make a device more affordable for consumers.”

Small local player

Ofentse Dazela, director of pricing research at Africa Analysis, believes Google’s Pixel 4 devices will jostle for patrons in the high-end smartphone market with the likes of Apple, Huawei and Samsung.

“The Pixel 4 new product range will become a serious consideration to potential buyers eyeing the recently launched Apple iPhone 11, 11 Pro and 11 Pro Max smartphones in the local market.

“While Google’s Pixel devices are known for their superior camera quality, there is currently little differentiation between the Apple iPhone 11 smartphone range and the new devices from Google.”

Dazela adds that the new smartphones from Apple and Google come with an impressive 12MP camera (two rear camera lenses), and “there are new interesting features such as Motion Sense which uses a mix of sensors, infrared and a tiny radar to let a user unlock the Pixel 4 with a face”.

Further, he says Google remains a small player in the smartphone market locally.

“By the end of September 2019, Samsung was the dominant player with 44% market share, followed by Huawei at 26%, while Apple was sitting in third position with about 15% market share.”

Ponela says “it’s unlikely we will see the Pixel make its debut in Africa any time soon but customers who want to buy Google phones will purchase it online”.

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