The African market is much closer and more accessible to many Chinese fabless companies than we think.
Earlier this week, Spreadtrum formerly announced a
strategic partnership with Orange, the French cellular operator.
According to the announcement, Orange will use Spreadtrum’s low-cost
mobile platforms for cost-effective, feature-rich mobile handsets and
smartphones for consumers in Orange's European and African markets.
meat of the story here, in my mind, is Spreadtrum’s ambition to get
into the vast African market. The Chinese chip company is doing so
strategically, rather than opportunistically. Working with the French
operator—which has a sizeable presence in Africa— is the key to
Spreadtrum’s selling chips into the African market, explained Spreadtrum
CEO Leo Li in a recent meeting with EE Times.
Spreadtrum CEO’s close connection with Orange is well known in the
industry, the latest announcement makes that relationship much more
The two companies confirmed in the release: “Orange and
Spreadtrum have now achieved the first milestone in the delivery of
Spreadtrum-based handsets to Orange's markets, with a feature phone
designed by Alcatel, the Alcatel One Touch 1060, that is based on
Spreadtrum's SC6531 2.5G baseband chipset and is now qualified for
launch in Orange's markets beginning with France.”
In a recent
conference call with financial analysts, Li also explained that for the
African market, “there is a demand for feature phones and WCDMA feature
phones, because I think 2G networks are very crowded. They want to
offload the traffic from 2G network to 3G, even including voice type of a
A recent story on a website called Electronics360 reports that executives at last month's Mobile World Congress referred to Africa as “mobile's last frontier.”
illustrating Africa’s potential, market research firm IHS iSuppli reported
that Africa’s population is growing from one billion in 2010 to 2.1
billion in 2050. A third of these people will be 15-34 years old
(potential mobile phone users), and that number is expected to double by
Africa’s consumer spending was $920 billion in 2010. That figure will be $1.4 trillion in 2020, according to IHS.
Here’s the kicker, if you’re looking for a genuine growth market.
reported that the number of mobile connections in sub-Saharan Africa
grew 44 percent from 2000 to 2012, compared to an average of 34 percent
growth in other developing regions and a 10 percent increase in
So, what’s your Africa strategy? Or don’t you have one?