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Asus To Enter US Smartphone Market

Asus To Enter US Smartphone Market
July 30, 2013 10:51AM

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One of the difficulties for a newcomer in the smartphone scene like Asus is building relationships with carriers and retailers. This hurdle is the one that is facing Canonical's Ubuntu Edge, which will have a difficult time in the marketplace even if it receives funding. Asus CEO Jonney Shih said the company was working to build those connections within the U.S.

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Asus has made a name for itself in the computer industry, but CEO Jonney Shih is looking to expand its business past computers and into the already-crowded smartphone market.

Despite the American smartphone market being considered one of the most difficult to enter, analyst Stephen Baker of NPD Group said there was room for another company.

"Samsung and Apple [each] only have about 30 percent of the market," Baker said. "Asus has proven itself capable in the PC market of segmenting, and if you want to be in the smartphone market, you need to be in the U.S."

Previous Asus crossover devices such as the PadFone and FonePad have always appealed to a niche community, but the planned smartphone will be the first one in the U.S. to actually compete in the mainstream marketplace. Baker told us the success of the device would not be reliant on features but on entering the market with multiple configurations and versions of the phone.

Building Bridges

One of the difficulties for a newcomer in the smartphone scene is building relationships with carriers and retailers. This hurdle is the one that is facing Canonical's Ubuntu Edge, which will have a difficult time in the marketplace even if it receives funding.

Asus has strong connections with retailers and carriers outside of the United States, and Shih said the company was working to build those same connections within the U.S. Much of the actual manufacturing seems to be under way. But without strong carrier connections, Shih said, he does not believe a 2013 release of the phone is likely.

"I think next year is more reasonable," he said.

Based on previous Asus devices, it is likely we could see a high-end smartphone to start with, but a convertible smartphone such as the Padfone is less likely.

Can Asus Do It?

With such little room for Asus to successfully enter the market, it will be hard-pressed to find success, but the Taiwan-based company does have some things on its side. Asus already has connections with U.S. retailers for other hardware products and it has a bit of experience when it comes to manufacturing tablets in the U.S. or smartphones elsewhere.

Unlike a company such as Canonical, Asus is not entering the smartphone market with its first piece of hardware ever created. Its longstanding reputation of providing high-quality devices -- whether it be in the mobile or desktop computing markets -- will play well as it tries to push the phone out to carriers and retailers.

The issue for Asus is whether or not it is too late.

"For the phone," Shih said, "frankly speaking, we are still latecomers."

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