I just did some research on texture formats, and it seems that Mali (up to 400) supports only ETC1, and thus does not store transparent compressed textures.

I actually *like* this. Yes, lacking transparent textures is an arguably important feature that is missing, but I like that Mali is complying with the standard, and thus waging a war against fragmentation. A game targeted for Mali will work on other devices without much fuss.

Of course, you can still have transparencies in Mali, but these would be implemented through the shader that you use. Either you designate a flat transparency over the texture, store an alpha graphic that represents the transparency, use a procedural function for transparency, designate a color for transparency and remove in shader, use no compression, etc.

Not terribly difficult to work around.