Budget smartphone sales hit two-year high on 2G shutdown

December 23, 2024 - 15:08
The sale of budget smartphones has reached the highest level since 2022 in Việt Nam, driven by the shutdown of the 2G network.
Users look for smartphones that support 5G connection at a store in Phan Rang - Tháp Chàm, Ninh Thuận. — VNA/VNS Photo

HANOI — Budget smartphone segment, priced under US$200 (VNĐ5 million), accounted for about 51 per cent of the total industry revenue in the third quarter of 2024, marking the highest share since the first quarter of 2022, according to Vietnam Handset Market Tracker.

This segment also grew 38 per cent in the third quarter of this year compared to the same period in 2023.

Within the under VNĐ5 million price range, Xiaomi held the largest market share at 27 per cent, with its best-selling models being the Redmi 13 and Redmi 14C. OPPO also recorded significant revenue growth in this segment, up 96 per cent year-on-year, driven by the OPPO A3x.

This growth was heavily influenced by the shutdown of the 2G mobile network.

"The share of 4G smartphones will remain high in the coming months in Việt Nam, and OEMs (original equipment manufacturers) will look to clear off their 4G stocks in the entry-level segment," Counterpoint Research stated, calling the phase-out of 2G a ‘milestone.’

In preparation for the 2G network shutdown, the Vietnamese government and telecom operators implemented various measures to encourage users to switch to 4G-compatible devices. Some telecom providers covered the cost of device upgrades for subscribers committing to long-term 4G plans, even offering free 4G phones to customers unable to afford new devices.

For instance, Viettel has supported many customers in purchasing 4G smartphones with a 50 per cent discount, providing subsidies of up to VNĐ1.1 million.

Viettel Telecom established 10,000 service points nationwide to assist with device upgrades and collaborated with mobile retailers to offer users affordable options for upgrading to 4G phones. The telecom provider also reportedly spent around VNĐ300 billion to distribute 4G phones to 700,000 2G subscribers.

One of the largest retailers, Thế Giới Di Động (Mobile World), encouraged customers to trade in old 2G phones for vouchers worth VNĐ480,000 ($19) toward purchasing a 4G SIM. Similarly, FPT Shop introduced a programme to support the exchange of old 2G devices for new 4G devices with gift vouchers worth up to VNĐ600,000 ($24).

From a commercial perspective, the device upgrade programme presents an opportunity for the smartphone market to boost sales while helping mobile retailers clear inventory of 4G smartphones and older 4G models.

Việt Nam plans to phase out 3G, which has 38.2 million subscribers, by September 2028 and aims to achieve 99 per cent 5G coverage by 2030. — VNS

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