C'mon, Smartphone Designers, Step It Up!

From Apple's iPhone to Google's Android models, high-end smartphones are scraping the bottom of the innovation barrel.

Jan 26, 2014 at 8:00PM

After several years of dramatic growth, high-end smartphone makers are struggling to find new approaches to stimulate demand. From quirky form factors to questionable features, smartphone "innovation" was disappointing at this year's 2014 International CES in Las Vegas. Even Apple's (NASDAQ:AAPL) iPhone and models based on Google's (NASDAQ:GOOGL) Android OS are making only incremental improvements.

Motley Fool analysts Rex Moore and Eric Bleeker discuss the problem from the floor of the world's largest consumer electronics show.

A full transcript follows the video.

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Rex Moore: What about the worst of CES?

Eric Bleeker: You know, across the past four or five years, everything's been about smartphones, tablets. The growth has been there. It has probably been the most dramatic field of growth in technology history.

It's totally boring now. You look at phones; they are black and white rectangles of varying sizes, and it shows, with what these companies are doing. Yeah, sorry about that!

Moore: Yeah.

Bleeker: But the thing about Apple even, on that front, it's all about the ecosystem that's being built off. I know that sounds hackneyed, but people are buying Apple for a reason. They like iOS, they're very built-in.

Getting people to want to buy a phone based on any kind of hardware changes is just a dead game. The LG G Flex ...

Moore: Curved screen?

Bleeker: The curved screen, 6" ... I could not get behind that. Huawei had a phone that charges other phones. What percent of the population is commonly carrying two phones?

You look at the kind of parlor tricks they're trying to use to stimulate demand on the high end; it's just essentially tapped out. You've got Apple playing against Android vendors who ... it's a very competitive market, and that's tough.

You see Samsung struggling right now for a reason. Their most profitable areas, there's just not a lot of sex appeal there anymore.

Eric Bleeker, CFA has no position in any stocks mentioned. Eric Bleeker, CFA has no position in any stocks mentioned. Rex Moore has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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