In the mobile phone industry, and indeed, in most technology sectors, price decline is a fact of life. Component prices tend to drop while their performance increases. This rapid obsolescence drives prices down constantly. Competition also plays a part as undifferentiated products are rapidly imitated.
This phenomenon has its own term: price erosion. It’s built into most business plans and forecasts.
But how real is it? What are the implications in terms of market share if one accelerates price erosion or reverses it?
This chart shows the average selling price for all the vendors whose data I maintain over a period of time. Continue reading “What's the opposite of price erosion?”