Info-tech

Indian handset brands lose steam as overall mobile market declines

Our Bureau Bangalore | Updated on March 12, 2018 Published on July 09, 2012

Indian consumers can look forward to steeper price drops and more features at the same price, says a study of the mobile handset market.   -  V Sreenivasa Murthy

bl10_mobile_col.eps

The mobile handset market in India declined by 5 per cent by revenue to Rs 31,215 crore during financial year 2011-12 against Rs 33,031 crore last year, a Voice & Data survey said on Monday.

The biggest impact has been on Indian phone brands such as Micromax, Spice and G5 due to declining sales in the feature phone segment and falling average selling value. Barring Karbonn and Lava, most of the other players have seen falling revenues, according to the survey.

Market watchers said that many Indian brands are finding it difficult to survive due to various reasons, including dollar movement against the rupee.

“Many of the companies were focusing on marketing and advertising, but they were not physically present with products. They were not investing much on research and development and feature rich products as per consumers’ demand,” Mr S.N. Rai, Co-founder and Director, Lava Mobiles, told Business Line.

He said going forward, handset makers will have to invest to increase value chain, R&D and contents otherwise it would be tough for them, to survive in the market. “Companies have to think of surviving for at least three years. Then only they can become big,” Mr Rai said.

Nokia tops the table

Overall, Nokia remained the number one player in the handset business during the year with revenue of Rs 11,925 crore, despite eight per cent drop over Rs 12,929 crore last year.

At the same time, Korean major Samsung grew its revenue by 38 per cent to Rs 7,891 crore which was positioned second.

Home grown handset company Micromax with revenues of Rs 1,978 crore was ranked third though the company recorded a 13 per cent decline in its growth.

“It was a year of consolidation for us with few management changes and our focus to launch of tablet personal computers. However, volumes were still intact. But, revenue was down because 60 per cent of the industry sold below Rs 1,500 bracket for a handset including us,” a spokesperson form Micromax said.

Agreed Mr Deepesh Gupta, Managing Director, Zen Mobile, saying “Lot of companies who could not sustain their businesses because of lack in logistics, marketing and sales knowledge. That led to lowering down of average selling price though volumes were still growing.”

As consumers look for applications beyond voice and SMS the market would see fight for high-end feature phones and smartphones intensify further.

Consumers can also look forward to steeper price drops and more features in the same price, said Mr Ibrahim Ahmad, Group Editor, Voice & Data.

“Indian mobile phone brands that had hoped to make a mark by sourcing Chinese handsets and selling them only on the price plank were in for a big surprise. These players will have to quickly rethink their product, marketing and service strategy afresh to put their house in order,” he said.

Voice & Data is a journal for the telecom industry by CyberMedia group.

The firm surveyed over 30 mobile handset companies – both multi-national and Indian – selling feature phones, multimedia phones, enterprise phones and smartphones.

>[email protected]

Published on July 09, 2012
null
This article is closed for comments.
Please Email the Editor