RJio effect: Feature phone makers gearing up for low-cost 4G handsets

Urvashi Valecha Mumbai | Updated on January 11, 2018

Feature phone manufacturers in India are being compelled to start integrating LTE technology into their handsets after Reliance Jio announced its plans to launch low- cost 4G feature phones.

Akshay Dhoot, CEO of Videocon Mobiles, said: “We have developed a feature phone with 4G but we are still in the process of launching it.” He believes that Jio phones could, to a certain extent, hamper sales of Videocon feature phones but in the long run, it wouldn’t make much of a difference since Videocon has shifted its focus on smartphones.”

According to his estimates, Jio with its array of plans would be able to capture approximately 25-30 percent of the feature phone markets.

“In the end, we would have to take Jio as just one more competitor in the market,” Dhoot added.

Gaurav Nigam, Product Head at Lava International, said his brand is ready to face the intense competition in the segment. “ To ensure that we stay ahead of the curve, we started our journey by building a robust sales and distribution infrastructure.”

Lava, as a part of their sales strategy, plans to increase their sales workforce by this year-end. Apart from focussing on just retail and distribution, Lava would be launching their new 4G compatible feature phone called Lava 4G connect M1 which they affirmed would be an affordable range for their users.

Potential tie-ups

Pavel Naiya, Senior Analyst, Counterpoint Research, told BusinessLine that telecom operators may tie-up with handset manufacturers and come up with the competitive plans to counter Jio.

Overall mobile phone market shipments in Q1 2017 was 56.6 million units with a marginal sequential dip of 3.2 percent. Feature phones registered 29.7 million units in Q1 2017 with a 9.4 per cent decline over previous quarter, according to IDC.

Jaipal Singh, Senior Market Analyst, IDC India, said, “There will be good number of people migrating to Jio. However, it will not be disruptive or a category killer. The entire segment — 50 per cent of feature phone market is less than ₹1,000. Use cases have been very different for these. Internet is not a priority for them. Most people are not even aware of how to use internet and what to do with it.”

Published on July 27, 2017

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