Android phone repair cost telcos billions: study

Wed Nov 2, 2011 8:12pm EDT

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(Reuters) - Fitting older versions of Google's Inc popular Android software to cheaper cellphones could send the repair costs of global telecoms operators up as much as $2 billion, a study by wireless services firm WDS showed.

Costly hardware failures are more common on Android devices than on Apple Inc iPhones and Research In Motion Inc BlackBerry phones, which have strict control over the components used in their devices, WDS data showed.

Cheaper Android models, costing as little as $100 to make, have helped Android emerge as the dominant platform in smartphones, attracting dozens of manufacturers ranging from Samsung Electronics Co Ltd to no-brand Asian vendors.

"While this price point sounds very attractive, when you look at a total cost of ownership its a different story," said Tim Deluca-Smith, Vice President of Marketing at WDS, which offers device management and call center services to operators.

Android's share of the global smartphone market rose to 57 percent in the third quarter from 25 percent a year earlier and just 3 percent two years earlier, boosted by the success of models from Samsung, HTC Corp and Sony Ericsson, according to research firm Canalys.

Deluca-Smith said that, while Android has helped take smartphones to masses of people, it has come at a cost, especially when telecommunications operators roll out cheaper devices from less-known brands.

"At the moment, Android is a bit of the Wild West," he said.

He said returning a device costs an operator on average 80 British pounds in service costs, transport fees or in the costs of replacing of the device.

The study covered 600,000 technical support calls taken by WDS across Europe, North America, South Africa and Australia.

(Reporting By Tarmo Virki; editing by Andre Grenon)

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Comments (6)
patfactorx wrote:
This is a ridiculous story. Carriers don’t make $200 on a phone they make $2,000 on each smartphone they sell. Their margins on smartphone sales are huge and selling a $20 cheap Android phone to make $2,000 is an insane deal. Their margins are still higher on Android than any other platform because Android phones are still a lot cheaper.

Nov 02, 2011 10:17pm EDT  --  Report as abuse
rignic20001 wrote:
And cheap hardware is exactly why so many people purchase Android based devices, because they can get them cheaper but then they get upset whenthe phone stops working and the carrier says “Tough Luck” and they have to go out and pay full price for another device…

… which turns out to be even cheaper hardware because they are paying the full price for it.

Sorry to say, Give me an Apple iDevice any time! I know people that have not had any hardware issues and still using their first iPhone after years.

I have only ever had one issue and Apple replaced it immediately without any argument.

Give me a walled in garden of safety supplied by Apple any day. Sorry Richard Stallman, I want something that I do business from to work all the time and work how I expect it not work or maybe not work.

Nov 02, 2011 10:57pm EDT  --  Report as abuse
$2B is all? That’s peanut skins in the scheme of things.

Nov 03, 2011 2:18am EDT  --  Report as abuse
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