Name: Shahraiz Nasir

Class: BBA 4B
Reg No: 19-Ntu-Ba-1388
Professor: Mam Mina Kharal
Topic: Why cell phones gotten more expansive over time.

Introduction:
Since 2000, the evolution of phones has gone into overdrive, with today’s
smartphones boasting a staggering range of features. In fact, despite still having
the word “phone” in their name, a typical modern smartphone has more in
common with a computer than what we would traditionally think of as a phone.
The smart phone manufacturers have changed the game of the market by
launching different variants and different functions mobile phones.

Problem statement:
Mobile manufacturers have launched a new dimension of releasing latest products.
Internet users, nowadays youth prefer purchasing latest products and expensive
brands. In this research study, the purchasing behaviour of consumer i.e., Youth and
business persons will centre of attention. This research will observe the change of
purchasing behaviour according to four variables that we will discuss.

Variables:

1: Improved but Expensive Features

2: Features Most People Don’t Need
3: Development and Innovation
4: Branding
 Theoretical Framework:

Improved but
Expensive Features

Features Most People

Cell phone gotten
Don’t Need more expensive over
time

Development and
Innovation

Branding
 Research Objectives:

Fundamental objective of this investigation is to discover which variables is the

cause that smartphones are expensive.

Hypothesis:
H1: Improve but expensive features are positively related to high prices
H2: Extra features which are not for use are directly related to increase in prices
H3: Development and Innovation is positively related to increase in prices
H4: Branding is positively related to high prices

Literature review:

Due to many competitors in the market the companies are releasing their
upgraded and new devices rapidly. This has meant that the smartphone market
has become incredibly competitive. The biggest producers are constantly trying
to create a device that are better than their last and is better than their
competitors’. Creating and building devices that have all this new technology
costs money. But can that alone account for how expensive smartphones have
become?

The price of a modern, top-of-the-range smartphone can be way over $1,000.

Compared to their counterparts a few years ago, these flagship models can seem
highly expensive. There are several reasons why the price of a smartphone
jumped up.

Improve but expensive features

Smartphones are also just more expensive to make. Mobile technology has
improved rapidly, and since we have new devices with bigger screens, bigger
batteries, and camera modules that can rival DSLRs, so you will understand why
cost is increasing.

OLED is a perfect example. Most premium smartphones (and even some that
aren’t) use an OLED panel. Without getting too technical, OLED screens have
incredible colour accuracy and they support HDR. So, everything just sort
of pops on these displays. And guess what? They are more expensive to produce
than LCD screens.

Features Most People Don’t Need

The reason smartphones are so expensive now and out of reach for so many
users is because there just features that the vast majority of people aren’t going
to use.
Look at the back of your smartphone right now. How many cameras does it
have? Three? Four? How many of them have you used more than once?
Why do we need an ultra-wide-angle lens, aside from the occasional family
reunion? Why does the iPhone 12 Pro record in HDR? For that, why does it have
a LiDAR scanner? Why is Samsung adamant about developing the Bixby virtual
assistant, which maybe five people use?
Sure, many of these features are cool, but they are wholly unnecessary to most
people.

Development and Innovation

Making a better phone isn’t just a case of getting and making new hardware.
Unless you put that hardware to good use, your new phone won’t offer any
significant improvements over the previous model.

To create a better phone, you need developers and engineers and lots of
them. Apple hires 12,000 engineers in the US alone. And these tech experts
don’t come cheap. Engineer salaries at Apple US range from around $71,000 to
$164,000. If we take the median salary of a developer to be $117,500, then
Apple spends just under a whopping $1.5 billion on development and
engineering talent alone.

All those fancy new features your new smartphone offers have cost the
company who made them a huge amount of money. What’s more, as
competition in the smartphone market continues to heat up, the costs of
development and innovation will too. Phone manufacturers must cover these
costs somehow, and the most obvious way is to increase prices.

Branding
The world of designer clothes is sustained by high consumer mark-ups. A pair
of shoes may cost just £100 to manufacture, but a popular brand could feasibly
sell them for as much as £1,000. That’s the power of branding. And we’re all
sucked into it.

When technology manufacturers first started out, they sold their goods on
product specifications and technical details. The early adopters of computing
and smartphone technology were far more interested in functionality than
fashion. But, as smartphones became ubiquitous, those making them realised
that they could sell their goods as fashion items too.

Apple, some have claimed, has transitioned from a technology company to a

fashion company. The company placed more and more emphasis of aesthetics,
and, beginning around 2015, began poaching a some of the biggest names from
the fashion and luxury design industries.

Although Apple are perhaps the best example of a tech company re-branding
itself as a fashion company, other smartphone manufacturers have attempted to
do similar things. And the biggest motivation is profit. Consumers are far more
willing to part with their hard-earned cash if they believe the product, they are
getting will make them look stylish and cool. So, as smartphone manufactures
continue to build their brands, we can expect consumer mark-ups to increase.
Indeed, branding has already played a significant role in the price hikes we’ve
seen over the last few years.