Cheaper smart phones market is dominated by Android

For the most part, the cheaper smart phones market is dominated by Android. With Windows Phone 8, however, Microsoft targeted one of Android's biggest weaknesses — performance. As powerful and customizable as Android is, it has a track record of poor performance on phones with lower specs. Windows Phone may not be as popular as Android, but it's a relatively standardized platform — meaning that using one Windows Phone feels like using nearly every Windows phone.

Before it was officially acquired by Microsoft, Nokia released the Lumia 520, 521 and 525 handsets that quickly became the most popular Windows phones in the world. A sub-$100 price point and fairly smooth everyday use made the series ideal for first-time smartphone users. Since then, Microsoft has rolled out more cheap models that feature significant hardware upgrades, while maintaining ridiculously low price points. Entry-level Lumias demonstrated what companies could accomplish by building software meant to run on simpler, cheaper hardware.

The rising quality of smartphones priced under $200 is making them more attractive to the average consumer, but the low end is being redefined from above as well.

"Increasingly, people are starting to understand the true cost of signing a contract, and we want to make it easier to purchase a high-end device without having to give a large portion of money to a middleman," Pei said. "We're here to show everyone what's possible once you step outside of the traditional rules of the smartphone market."

ARM, the company that designs most of the world's cellphone processors, projects that by 2018 1 billion low-end smartphones will ship compared to 250 million high-end devices. What those devices will look like exactly is unclear, but it's obvious that the low-end market that we knew is evolving into something bigger, stronger and cheaper than ever.

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