Dell, which competes with Hewlett-Packard, Acer, Apple and Lenovo within the worldwide PC marketplace, is ready to enter the lucrative smartphone marketplace with a range of mobile phones which are scheduled for release more than the following year.
We estimate that the wise telephone company will add slightly much more than $1 billion in value to our valuation of Dell’s stock if Dell can achieve a modest 0.5% marketplace reveal within the worldwide mobile telephone marketplace and maintain wise telephone costs comparable to numerous from the existing players within the space.
We estimate that the mobile phones company constitutes 3% from the $17 Trefis cost estimate for Dell’s stock. Beneath we discuss our expected pricing and marketplace reveal trends for Dell’s mobile company.
Dell’s Smart Telephone Costs to Decline from $450 to Beneath $300
Dell is producing an aggressive entry into the wise telephone marketplace in 2010, a marketplace that has gained substantial traction since the launch of RIM’s BlackBerry in 1999 and Apple’s iPhone in 2007.
Numerous other players like Nokia, Motorola and Google have also entered the wise telephone marketplace with their own versions of wise phones. Apart from a couple of exclusive functions, most from the wise phones have a typical set of functions which has resulted in standardization of wise telephone costs to some extent.
Dell plans to a launch a series of wise phones in 2010, of which ‘Streak’ has been priced at close to $500. We estimate the cost for Dell’s other wise phones to be within the range of $400 to $500 for 2010, and forecast an average value of $450 for Dell wise phones in 2010.
We anticipate Dell’s wise telephone costs to decline further and reach beneath the $300 levels through the end from the Trefis forecast period, fueled by growing competition within the segment and increasing commoditization of wise phones.
Dell’s Mobile Telephone Marketplace Reveal to Improve To 0.5%
Dell will face powerful competition from wise telephone vendors for example Nokia, Apple, RIM, HTC, Samsung and Motorola who have powerful presence in countries like the U.S., China, Brazil, U.K. and India where Dell plans to introduce its phones more than the following year. This has led us to remain conservative in our estimates for Dell’s wise telephone reveal. For 2010, we estimate Dell to capture only close to 0.1% reveal from the total worldwide mobile telephone marketplace.
We anticipate Dell’s unit sales in 2010 will be led through the ‘Streak, a wise telephone or tablet device ideal for consumers who don’t wish to spend on two separate devices. Streak has a bigger screen than other obtainable wise phones within the marketplace, producing it convenient for the user to read and watch videos. Its 5-inch size with camera functions (that aren’t present within the iPad) give it an upper-hand in some methods more than other tablets.
As Dell introduces new wise phones for example ‘Flash’, ‘Lightning’, ‘Smoke’ and ‘Thunder’ more than the following year and expands into other regions, we anticipate its marketplace reveal to benefit. We estimate Dell’s marketplace reveal within the worldwide mobile telephone marketplace to reach 0.5% through the end from the Trefis forecast period.
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