Smartphone prices have to drop below Rs 5,000 and additional spectrum is required for the country to reach 200 million smartphone subscribers, according to Google.

“We are optimistic about India's smartphone penetration hitting the 200-million mark by 2015 but feel that prices have to be sub-Rs 5,000 for more smartphone penetration,” Mr Rajan Anandan, Managing Director, Google India, told Business Line . A price reduction of 30 per cent more is needed to drive smartphone sales, he added.

Currently, India has around 10–15 million smartphone users and over 900 million telecom subscribers. According to a recent Boston Consulting Group (BCG) report, India's Internet economy growth rate of 23 per cent makes it the second fastest across the G-20, ahead of other developing nations, which are growing at an average of 17.8 per cent.

According to IDC, smartphones shipment in India grew 21.4 per cent in third quarter of 2011 over the previous quarter and 51.5 per cent over the previous year.

Mr Anandan similarly predicts that 2012 would be the year when mobile shipments would surpass desktop PCs.

According to IDC estimates, in 2011 mobile phone shipments of around 184.4 million units and IDC forecasts the market to clock 301 million by calendar year 2015, at a CAGR of 13.03 per cent. Of this, smartphone segment is forecasted to see an increased CAGR of 63.4 per cent with a shipment of 77.5 million by CY 2015.

With trends like social media on the rise coupled with an increase in online commerce, smartphones could be the first computing device, say industry watchers.

According to the second quarter of 2011 IDC PC Tracker report, the Indian PC market sales stood at 2.44 million units, showing a sequential decline of 4.2 per cent over the previous quarter indicating a trend of consumers wanting more mobility-based devices for their computing needs.

>venkatesh.ganesh@thehindu.co.in

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