The sub-$100 Android handset - Google's doomsday weapon?

Could the sub-$100 Android handset be Google's 'doomsday weapon' against Apple, RIM, Microsoft and Nokia?

Arima Communications is developing an Android smartphone that will sell for less than $100 ... an important psychological price point to break if smartphones are to become the new cellphones.

According to Digitimes, Chinese-language Commercial Times is reporting that Arima is getting ready to ship samples to clients and is expected to ship five million handsets in the second quarter of 2011 compared to four million shipped in the first.

The handset market is odd. For example, while Apple has only 4% of the global cellphone market, it pulls in a massive 50% of the profits. Everyone else's profits come from that other 50%. And that's important. While Apple has a hugely popular brand and massive profit margins, everyone else is scrabbling in the dirt for coins.

But ...

Cellphones are one of those things where branding sells. The iPhone is the best example of this, but it's far from being alone. Nokia, Samsung, HTC and many more players rely heavily on branding to sell to an increasingly fickle market. Who made your phone is just as important (if not more important) that what OS it runs or what it can do (or what the owner can do with it).

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A no-name brand might be able to grab enough market share to exist, but if price really was was an issue, the iPhone and other expensive smartphones would have never taken off like they did. Also, with carrier subsidy, it's possible to get a top-end smartphone on the cheap (or even for nothing) in exchange for signing your life away for a couple of years.

Nah, a sub-$100 handset is no 'doomsday weapon.' OEMs don't really have anything to worry here.