Battle for India hots up as local vendors catch up with MNCs

Indian phone maker Micromax has begun to eat into market leader Samsung’s smartphone share.

The Korean phone maker’s market share in the smartphone segment has fallen from 32.7 per cent in the first quarter to 26 per cent in the second quarter of this year, according to market intelligence firm International Data Corporation (IDC). On the other hand, aggressive marketing and brand promotion being done by Micromax has seen its share go up from 18.8 per cent in the first quarter to 22 per cent in the second quarter ended June.

While multi-national phone brands still lead the Indian market, their overall share has been steadily dropping as local vendors bridge the innovation gap.

Amongst the local vendors, most of the bigger ones have successfully transitioned their lead in feature phones to smartphones, including Micromax, Karbonn, Lava, Intex and Celkon, the IDC report said.

“The growth in the India smartphone market is driven by consistent performance by local vendors who accounted for more than half of the total smartphone market in the second quarter this year,” Manasi Yadav, Senior Market Analyst at IDC India, said.

These vendors have been scaling up operations owing to rising migration of the user base from feature phones to smartphones, she said.

Micromax’s milestone

“Micromax has crossed the two million units shipment mark in second quarter this year and is poised to be the number one smartphone player in India by third quarter,” Rahul Sharma, Co-founder, Micromax said. The company said it is targeting a billion dollar revenue but did not say by when it plans to achieve this.

According to the IDC’s Asia Pacific Quarterly Mobile Phone Tracker, vendors shipped a total of 9.3 million smartphones during the quarter as compared to 3.5 million units in the same period last year.

The shipments to India during the second quarter also grew by more than 50 per cent over the units shipped in the first quarter of this year, it said.

Growing phablet sales

The five-inch to 6.99-inch screen-size smartphones or phablets grew 17 times year-on-year and the phablet share has steadily risen to 30 per cent of the smartphone market in the second quarter this year.

“The key for growth in this market, as with most emerging markets, is a low-priced phone equipped with a large screen and dual SIM slots,” Kiranjeet Kaur, Senior Market Analyst at IDC's Client Devices group, said.

Topped with an attractive sub-$200 (around Rs 12,000) price tag, these smartphones are highly attractive, she said, adding that the share of sub-$200 smartphones in the second quarter accounted for two-thirds of the total smartphone market.

ronendrasingh.s@thehindu.co.in

(This article was published on August 29, 2013)
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