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Sonim Targets Extreme-Phone Micro Niche

10/14/2008 03:38:00 PM Eastern

San Mateo, Calif. — Sonim Technologies, a Silicon Valley newcomer to the cellular industry, is entering the U.S. market with what it calls the most rugged cellphones in the world following its launch of ruggedized phones in 32 other countries, mostly in Europe but also in Australia and New Zealand.

In the U.S., Sonim is targeting distribution channels that reach Sonim’s target consumer: “people who work or play in extreme environments,” said president/CEO Bob Plaschke. They include “very aggressive outdoorsmen” who need a durable phone as well as construction workers, engineers, plumbers, builders and other tradesmen who need a phone that they can use on the job, he said. The combined market, dubbed a micro niche by Sonim, represents about 2 percent of the U.S. population, he said.

These users would be attracted to phones that Sonim promises will be more rugged than anything else on the market, including Motorola phones operating on Sprint’s iDEN network. The potential for rugged phones is growing in the U.S., he noted, because the selection of rugged iDEN-network phones shrank during the past five years.

Sonim’s first U.S. phone, due in March in yellow or black, will be the XP3 Enduro, a quadband GSM/GPRS phone that features push-to-talk (PTT) service. As the industry’s first submersible phone, it can remain in water for a day, Plaschke said.

Like the XP1 already available outside the U.S., the XP3 will also:

  • withstand 100 3-meter drops on concrete. Other ruggedized phones, in contrast, are certified for 1-meter drop tests;

  • operate from -40 degrees to +40 degrees Celsius, whereas other ruggedized phones operate only in cold weather down to 10 to 25 degrees below zero, he said. Like the XP3, other rugged phones also operate in temperatures up to 40 degrees Celsius;

  • come with non-porous, hardened-rubber shell that’s “impervious” to sand, dust and industrial micro particles;

  • offer an antiglare scratch-resistant screen for viewing in direct sunlight;

  • deliver at least two days of talk time or two months of standby time;

  • feature durable mechanics, including keypad buttons tested with 500,000 pushes; and

  • come with three-year unconditional guarantee with same-day in-store replacement. Only 50 of 100,000 Sonim phones sold worldwide have had to be replaced, Plaschke claimed.

To reach people interested in such durability, Sonim will target rural GSM carriers, outdoors stores, retail chains where contractors have open accounts, warehouse clubs where businesses buy, and large enterprises such as utilities and package-delivery companies, Plaschke told TWICE.

“We’re focusing on retailers who focus on people who work or play in extreme conditions,” he explained.

The phone will give rural GSM carriers the opportunity to offer a differentiated product to their customers, many of whom are farmers or outdoors types, Plaschke added. “Rural GSM carriers never get the newest phones first.” Likewise, retailers could offer the phone as a private label with their name on front and Sonim’s name on back, he said. Hardware chains and warehouse clubs want to offer private-label phones but haven’t been able to get them on terms that they would like from carriers, he pointed out.

Through retailers, the phone will be sold unlocked and unsubsidized at about $400 to $500, but it can be sold locked at a subsidized price through GSM carriers or through retailers who choose to operate as mobile virtual network operators, Plaschke said.

Other features include GPRS low-speed packet data, Bluetooth 1.2, assisted GPS and a 3-megapixel camera.

The U.S. company launched its first rugged phones outside the U.S. so it could build volume profitably, Plaschke said. The rugged-phone market doesn’t exist outside the U.S., offering more potential for Sonim, he explained. Carriers and retailers in Europe also offer a lot more phone choices than U.S. carriers, who have reduced the number of handsets that they supported over the years, and that also offered more potential to Sonim, he said.

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