The next 1 billion Android phones will be $99

The PC market already went through this and history is repeating itself in the smartphone market. Smartphones are commodities. Your 2 year old Android phone can run all the most popular apps on the platform and most people aren't going into a carrier store asking for a quad core phone. If you take a look at Apple you can also see this being true for them. Half of all iPhone sales are the older generations.

The Verge is going to continue to talk about the latest flagship phones but the importance of these phones is going to diminish. Samsung might sell millions of Galaxy S4s and HTC has already sold millions of Ones but the real growth is going to be in the entry level phones these OEMs put out.

My prediction is that by 2015 the great majority of Android phones are going to be $99 off contract and the market for $599 off contract phones is going to be a niche just like it is in the PC market.

I think HTC has the right idea by going in the direction of the HTC First. Cut the specs and make money from the people who are looking for their first smartphone. When this succeeds they can keep lowering the production cost until they can get to the magic $99 off contract phone.