Kyocera Re-enters the Smartphone Market with the Underwhelming Zio

| Mar 25, 2010 | Mobile Devices | Analyst: Brad Akyuz

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Event Summary

March 23, 2010 -- At CTIA 2010, Kyocera Communications unveiled the Zio, its first smartphone running on the Android operating system. The 1xEV-DO Rev. A-powered Zio houses a 3.5-inch touchscreen display, a 3.2MP camera with video capture, and a 3.5mm stereo headset jack, and it offers standard Android capabilities such as Google Maps and Android Marketplace. The Zio will commercially debut in Q2; however, no carrier partner or launch pricing was officially announced.

Quick Take

Analytical Summary

• Current Perspective: Negative on Kyocera’s Zio smartphone, because while re-entering the smartphone market is a huge step in the right direction, the device Kyocera unveiled is at best on par with the first-generation Android smartphones on the market. The Zio runs an older version of Android, and Kyocera has done little to differentiate the device from the existing offerings in the marketplace. While this strategy is perfectly fine in complementing Tier-2 carriers’ smartphone segments, more sophistication will be required if Kyocera wants to penetrate nationwide carriers’ smartphone portfolios.

• Vendor Importance: Very high to Kyocera, because the vendor had long been waiting on the sidelines and limiting its market participation to the low-end feature phone segment, and this new smartphone initiative has the potential to change its competitive positioning in the marketplace. Leap Wireless has already been showing the new Zio here at CTIA; if Kyocera can secure national carrier distribution, it will officially be back in the game.

• Market Impact: Low on the smartphone market, because the prominent smartphone vendors have been selling similar if not better Android smartphones for over a year now and the Zio, which will not be available until later in Q2, does not have any unique characteristics to make any major impact on the market. On the other hand, it might have a stronger impact on the prepaid segment if Leap prices it aggressively at debut in Q2, as it could put pressure on T-Mobile’s rich Android lineup of smartphones that are sold with Even More Plus plans.

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Competitive Strengths and Weaknesses

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