Kenya’s middle class offers opportunity for smartphones market
Intel’s regional director in charge of Africa, Middle East and Turkey Aysegül Ildeniz. Illustration/Nation Media Group
What you need to know:
The Yolo smartphone becomes Intel’s third branded mobile phone.
Intel sees smartphone volume growing at 43 per cent compounded annual growth rate, reaching almost 100 million per year in 2016.
Intel is working closely with partners across Africa to develop smartphones that offer a quality and affordable experience.
American chip maker Intel in January chose Nairobi as the launchpad for its latest entry-level Android-powered smartphone dubbed Yolo.
The California-based tech giant has partnered exclusively with mobile operator Safaricom, which is selling the Intel chipset-powered Yolo at Sh10,999 and comes bundled with free 500 MB data.
The choice of Nairobi as Intel’s entry to the African mobile handsets markets raises the profile of Kenya as Africa’s Silicon Savannah.
Intel said it was attracted by Kenya’s high mobile penetration, growing middle class and the creativity on the mobile apps scene. The Yolo phone, targeted at first-time smartphone users or those graduating from feature phones, is set to be unveiled in other African countries from next month.
The Yolo smartphone becomes Intel’s third branded mobile phone. Last year, Intel produced the pioneer Xolo X900 and later a dual SIM model A700, which is available in India, the United Kingdom, and Russia. The firm touts the low-cost Yolo smartphone as having an advanced Intel processor that enables fast web browsing, super responsive apps, and multi-tasking.
The Business Daily spoke to Intel’s regional director in charge of Africa, Middle East and Turkey Aysegül Ildeniz who outlined the firm’s strategy in getting a bigger slice of the continent’s smartphone market.
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Why did Intel choose Kenya as the launching pad for the Yolo smartphone?
Kenya is a country with high penetration of mobile phones and where smartphone usage is increasing. Intel and Safaricom share a close working relationship and we’ve collaborated to deliver a differentiated offering for Kenyan customers.
The Yolo™ smartphone — based on Intel Reference Design — is an attractive handset for the growing volume of cost-conscious and first-time buyers in Kenya who do not want to sacrifice device performance or user experience for cost.
Apart from being a high growth-market and an important hub, it is part of a region that is experiencing rapid improvements in income levels and infrastructure, and offers a huge promise of continued growth as a consumer market.
What potential does Intel see in the smartphone segment in Africa?
About 80 per cent of Africa is accessing the Internet through their phones, creating a bigger demand for smartphones.
We see the smartphone volume growing at 43 per cent compounded annual growth rate, reaching almost 100 million per year in 2016.
This is due to the growing middleclass as well as the affordability of smart phones as compared to basic feature phones.
Intel is working closely with partners in multiple countries in Africa to develop smartphones that offer a quality and affordable experience. We are confident that many smartphones based on the new value reference design will be sold in other African countries.
We expect first-time buyers and cost-conscious users in emerging markets such as Africa, India and South East Asia will be thrilled with the rich Intel experience, features and performance they get from these smartphone devices.
How does Yolo compare with other products in the market in terms of price and performance?
The Yolo smartphone with Intel Inside strikes a unique balance between price and performance. We believe that we have the core attributes that customers care most about well addressed as we enter the value market segment.
The handset is based on the new Atom processor-based reference design targeted at the value segment of the smartphone market.
Our smartphones come with an advanced Intel processor for fast web browsing, super responsive apps, and effortless multi-tasking so it gives a better user experience.
Is the move to mobile phones part of Intel’s product diversification away from microprocessors?
We are not diversifying away from microprocessors. We are a manufacturer and supplier of microprocessors and other components for smartphones, laptops, tablets and desktops.
The Yolo smartphone is not an Intel Phone as such but it is a smartphone built on the Intel’s Smartphone Reference Design (Z2420) and is the first smartphone with Intel Inside in Africa.
Intel and Safaricom worked closely together to tailor the device’s capabilities to address local market opportunities and requirements.
Intel is partnering with leading handset original equipment manufacturers (OEMs) and carriers to bring Intel technology-based handsets to market.
The reference design provides a strong technology foundation on which our partners can innovate and quickly bring to market their own designs.
It is a technology enabler that speeds time to market and allows customers to focus on their own unique industrial design, hardware and software differentiation.
The Intel smartphone reference design is also a customer-ready platform for other Intel partners who want to quickly bring a product to market by focusing on software and service differentiation.
Has Intel begun producing processors for tablets? Do you also foresee Intel producing its own branded tablet devices?
We are currently working with a number of our customers, both the vendors and resellers, to bring a number of Intel Atom-based Windows 8 tablets and tablet convertibles to the market. That timing will depend on our customers’ schedules and details will be made available in due course.
Moving forward, what is your outlook for the PC and mobile microprocessor market? Do you think the world is fast moving to mobile devices compared to PC?
PC manufacturers are embracing innovation as we are in the midst of a radical transformation of the computing experience. Amidst the blurring of form factors such as convertibles, tablets and detachables and the adoption of new interfaces such as Windows 8 with touch, it’s no longer necessary to choose between a PC and tablet.
This is good news for the African market as Africa is not only one of the fastest growing economies, but in just the past five years, Africa’s mobile phone market has rapidly expanded to become larger than either the EU or the United States with some 650 million subscribers. The need for mobile devices is strong.
When do you plan to introduce Yolo to other African markets?
We do not disclose this type of information as it is confidential.
We are working closely with partners across Africa to develop smartphones that offer a quality and affordable experience. We only announce when the partners are ready to discuss it.
