The Little OEM That Could: Flagship Killers Never Settle
OnePlus has been one of the most talked-about companies of 2014. They have been the topic of countless discussions and debates all over tech enthusiast forums and websites, with comments in all shades of the spectrum. This buzz has been one of the main reasons One Plus became what it is today – a player in a rough game of an industry. And one of the hardest parts of the game is getting in it.
OnePlus has a noble vision of smartphones. They wanted their device to be affordable, and premium – a contrast with the trend of affordable and good that the Moto G began, but not an opposite contrast. OnePlus could have a huge impact in this industry in the long-term if they keep up this business model: if they provide us with high-end hardware for half the price of other manufacturers, the competition would have to adapt its prices accordingly. The repercussions could potentially benefit all smartphone consumers all around the world.
But what did OnePlus do to get all this attention, and generate all this buzz? Was it just the fact that they had a great deal of a smartphone? That is hard to believe given that there are many manufacturers, especially in asian markets, that offer top hardware for bottom price. And OnePlus didn’t have much advertising – in fact, it was almost exclusively publicized by word of mouth between interested smartphone hobbyists and the websites that cater to them. What was the key to their initial success?
The little OEM that could
OnePlus was founded as a start-up in December 2013 by Peter Lau. For quite a while, not many took attention to them and they were just another phantom company with no name nor brand recognition. But it all changed on April 23rd of 2014, when they announced their first device, the OnePlus One.
I remember the name originally bringing a lot of confusion to enthusiasts, and a lot of laughter too. Soon enough I saw people calling it the “Two” to the point of saturation. And with the relative mystery shrouding the company during those early days, many were austoundingly confused as to what the device was, many simply assuming that “OnePlus One” was a codename for the “HTC Two” (a would-be sequel to the HTC One). This initial undefined hysteria and turmoil of uncertainty would be cleared up within a few months, as people learned more and more about the device.
But what really started catching everyone’s attention was the deal OnePlus offered: Top of the line specifications, that would rival and in many ways surpass what was found in the HTC One M8 and Galaxy S5 (highest exponents of Android at the time), for less than half the price. How did they achieve such a low mark-up?
For every bit of hate OnePlus gets over some of their less-than-sound business decisions (which we’ll talk about shortly), there is some remnants of brilliance in their game plan. They were creating a compelling product that they knew the very enthusiastic sector would eat up due to the low entry price and specifications (chipsets in particular are a very big deal to most techies, although it shouldn’t be at this point). They were able to sell the phones at almost their build-cost because they didn’t put money in marketing, and instead, focused on various campaigns and other sorts of promotions to build awareness and demand. Then there’s the fact that they avoided selling it at retail stores and opted for online sales and mailing, much like Xiaomi does, which saves them a lot of capital.
Then there’s the biggest key point to their master plan: very much like Xiaomi, they will continue to support their product past the usual threshold of a year that you see other OEMs adopt. And the longer the product is in the market, the higher the profit per device gets, as the components get cheaper over time. What is originally a phone that doesn’t net them profit can potentially become a nice source of revenue. And this is one of the reasons as to why they build small batches of supply, a month at a time. This strategy where profit takes a backseat until the product can finally be capitalized is a growing phenomenon in all areas of the tech world, a particular example being Twitter. It’s a high risk gamble, and OnePlus seems to have nailed it thus far.
This philosophy had gained them a great initial impression in enthusiasts’ eyes. They became the small-town boy with big dreams, that was finally getting into the big leagues. Journalists, power-users, drooling consumers, all sympathized with them for various reasons. Sadly, OnePlus did a lot of questionable things and was involved in a lot of questionable situations, and thus started the controversy that surrounded the company and gave it the so-so reputation it has now. Before we look at that, lets recap what the OnePlus One brought to the table.
It’s all in the numbers
The OnePlus one reminds me of the products of old, those before psychoanalysis was merged with marketing in the 1920s and people stopped focusing as much on the practicality of their products. It is known that since then, products like TVs were mass produced and not built at just the right amounts to satisfy a demand. And car makers, for example, stopped selling their cars by blasting the buyers with their technical specs but by telling them how the beautiful design and premium leather seats would make the experience more comfortable.
Such an emphasis on the aesthetic, emotional and sometimes irrational desires in consumers is practiced by many companies, namely Apple and Samsung. They don’t just sell you high-tech electronics, they sell you “experiences” to “enhance your lives”. They don’t make their device about the bleeding edge internals, but more about “the next big thing”, or “inspired by nature”. These buzzwords and catchphrases function at a unconscious level and steer people not through reason and the logical calculus of “is this thing going to be useful to me?” but rather through the more primal desires of belonging, exploration, uniquity, and other unconscious tendencies. Through the marketer’s goal-post of “I need this”. OnePlus left the psychological mumbo-jumbo aside.
Its device sells on numbers alone. Not gimmicks, not the infinitely mocked “never settle” slogan, not the soft back. You just take a look at its specifications, at the numbers in the megapixel count, cores and frequency, battery size, screen size, resolution, and then look at the price, and think “I want this”. This is probably because OnePlus’ initial target demographic does focus more on these technical aspects than the average consumer, and they knew they didn’t need to entice us with silly sensors or whole language.
Let’s look at those specs: a 1080p IPS LCD panel that makes for a 5.5” display, a quad-core 2.5 GHz Krait 400 processor, 3GB of RAM, 16 to 64GB of storage, a front-facing 5MP camera, a 13MP rear shooter, and a phenomenal 3100 mAh battery. Those numbers sold the phone to eager enthusiasts. They didn’t need to attach the word “beautiful” to the display, or “powerful” to the processor, because the people here know that these specs were, at the time, the best you could get for $300 and perhaps the best you could get at all.
The phone itself had some other non-quantifiable perks that did get it good reviews, such as the baby-soft back and the CyanogenMod 11S ROM it packed, which was an exclusive version of CyanogenMod designed specifically for the OnePlus One.
All of this led to some glowing reviews. Almost every reviewer was blown away by the amount of greatness such a cheap package packed. There were very little downsides to the purchase, and it seems that OnePlus had made good on its promise. There were some issues, however…
The two main complaints the device received were ghost touches due to a faulty touchscreen, and yellowed displays. Both required RMAs that were not just expensive, but tedious. At first, OnePlus reported they could fix the touchscreen problems through software, and while the situation did get better, it was later suggested that it was not a software issue but a manufacturing problem. The yellowed screens sometimes also came with dead pixels. OnePlus’ customer support was anything but helpful to most consumers, and users were sometimes forced to pay their own shipping charges (all the way to China) themselves. Many customers didn’t even receive the option, though, as the amount of hardware defects was so high that the little company didn’t have enough customer support to handle and process all the requests…
What most people saw as the biggest downside to the OnePlus One, however, was one present before they even got their hands on the device…
OnePlus did something that upset plenty of the people that had intensely followed them up to the point they announced how you’d get your hands on their phone. They then revealed you needed to be invited to the purchase. Now, obviously this was done to adjust demand to the small batches of supply that their strategy entailed. They just couldn’t afford to be left with unsellable stock.
But this system was almost unanimously criticized by everyone in the industry, and the stubborn OnePlus didn’t see it as a fault but they stated it was “a blessing”. The invites were distributed through different promotions, many of which were controversial. Some were also distributed through their forums, to users with seniority or contributions in their belt. Many reported that the system was unfair and that they were promised invites that never arrived. Eventually they dropped the invite system, but their reputation had already taken a hit with all the things the company got itself into. What else happened?
Excluding the problems with their hardware and customer support, OnePlus did some intentionally questionable acts to get their phone out there. And some dirt under the rug got out there too. While they had trusted consumers to decide to purchase their phone on specs alone, they felt they needed to create promotions to further expand their influence and visibility, while also giving more users the ability to be royally invited to purchasing their device.
The first of these big controversies was the reveal of documents that linked OnePlus, the supposedly small-town boy startup, with OPPO Electronics, a company of who OnePlus’ founder was vice-president of. Not only that, but the files at the Shenzhen Municipal Market Supervisory Authority (quite the name) state that OnePlus is a 100% owned subsidiary of OPPO.
This lead everyone to speculate that OnePlus lied to all their followers when stating their initial origins and motives, and how they would go about their industry plans. Not just that, but their OnePlus phone shares a remarkably similar design in carcass to that of OPPO’s own Find 7.
To this controversy, Oppo responded that “OnePlus is a separately run company that does share common investors with OPPO”. It is true that the common investor reported by the Shenzhen Municipal Market Supervisory Authority (I pasted the name this time) is OPPO Electronics (investment company), which is not the same as OPPO Mobile (the phonemaker). But was still a shady practice to not be fully transparent about things like this, which resulted particularly damaging to their reputation.
The next controversy was a simple lie they told where they put out an image of the Sony Z1 on top of the OnePlus, showcasing how thin its bezels were to fit the entire phone under one with a smaller screen. But the problem is the OnePlus has bigger dimensions than the Z1. The OnePlus One’s body is 152.9 x 75.9 x 8.9 mm, while the Z1’s is 144 x 74 x 8.5 mm… smaller in every way. When OnePlus got called out on this, they simply refused to answer.
Then there’s the downright silly campaign of “Smash the Past”, in which OnePlus encouraged the participants to destroy their older phones on camera, so that they’d win the opportunity to purchase a OnePlus One for $1. Many were confused and either destroyed their phones before the promotion started, or destroyed phones that weren’t covered by it. Not only is it hurtful to the environment to smash these electronics to pieces due to battery waste, it’s also potentially hazardous and could result in an exploding battery or chemical burns. And to make things worse, they were encouraging people to break expensive and useful electronics rather than donating them to impoverished regions that could have an use for it. They later changed the promotion to a donation system, thankfully.
And it seems upsetting the environmentally concerned wasn’t enough, because they later managed to anger feminists too. Their “Ladies First” campaign asked female followers to take and post a photo of themselves, plus a OnePlus logo, on the forums. The winner would be decided by votes, and the most voted person would win an invite to the phone purchase. The campaign didn’t even take off, as it was cancelled soon after being announced due to all the anger it fueled on liberal circles and social media platforms. The scandal was ignited due to them stating “Ladies, no nudity please”, only missing a winking emoji. While they had to include this in the terms somehow, this was probably the most degrading way they possibly could have done so. And thus, social justice crusaders got up in arms and started a rightful boycott over the company’s social ineptitude.
And finally, the phone saw a banning in India, because Micromax had exclusivity rights to CyanogenMod software in the country, but the OnePlus also featured software by Cyanogen. The Delhi High Court banned the import and sales of OnePlus’ device. The ban was later lifted, but the OnePlus will feature a software revision. This is a very delicate topic we’ve already covered and I suggest you read our report on it.
Great Phone, Dubious Company
Despite all the setbacks, the controversies, the repeated boycotts and every shipping, hardware, and support problems OnePlus went through, they still pulled ahead and sold nearly 1 million devices in 2014, received amazingly positive reviews, and became the favorite phone of many users.
And this is because such a device aims at those who want a great package, and that recognize that what OnePlus sells is a steal of a deal. The Android enthusiasts that bought into the phone didn’t do so out of brand recognition, out of fashion symbology, out of irrational desires of belonging or status, or to experience natural inspiration or something that just works. They looked at the spec sheet, then looked at the price. Or at good reviews. And those who decided to purchase one out of rationale and not emotional judgement of a phone’s origin or its manufacturer’s reputation, ended up with a good product.
Because power-users do face fanaticism sometimes (cough Nexus), OnePlus tapped into a big and untargeted subset of consumers: those who can read a spec sheet and understand why their vision and their product is so great and most importantly, such a great deal. These users are probably the ones who would import an unheard chinese phone, as long as it packs great bang for buck. Because there’s many of us that just don’t care if OnePlus is the embodiment of bigotry, as we can compartmentalize that their phone is just a phone, and is not imbued with the inherent qualities of whoever made it. And this is also why the same rational power-users can criticize Apple’s shortcomings, and even Google’s.
I’m not saying all of OnePlus’ customers are thriving examples of independent thought – far from it. But when a company does so much wrong, and upsets so many, yet it still manages to sell its product the way it does in a highly monopolized industry… It probably means that the product is damn good, and the customers see this and don’t necessarily associate it or their own moral integrity with OnePlus’, simply over purchasing their product. Let’s be real, how many of you are using Windows right now…?
And so the year of the “little OEM that could” ends with a bang, and as a success. And it proves that in the end, a practical good deal of a product can compete (perhaps not win, but compete) with strongly marketed, highly integrated and unconsciously desirable products of the current capitalist world. Maybe we should go back to a time where people were a little more pragmatic in their purchases, rather than constantly dumping their old phone for the shiny new fingerprint sensor that they most likely won’t use and certainly don’t need.
I can’t wait to see what OnePlus has in store for us this year with its upcoming devices.