Mumbai: Indian mobile phone makers have taken a giant-sized bite of the local market in the span of about two years at the expense of established global manufacturers such as Nokia Oyj and LG Electronics Inc., latest data from research firm IDC India shows.
IPL showcase: An IPL season 3 match. Micromax and Karbonn have sought to use the tournament to advertise their emergence. Aman Sharma / PTI
Homegrown firms, which entered the market in early 2008, captured a 17.5% share of the 100-million handset market at the end of 2009, from a meagre 0.9% at the end of March 2008, IDC said on Friday. The number of local makers grew to 28 from five during the period.
In a market that remained flat at around 100 million units, Nokia fell from a 56.2% share in 2008 to 54.1% in 2009. Similarly, LG’s market share dipped from 7.2% to 6.4%, while Samsung Electronics Co. Ltd’s share rose marginally to 9.7% from 9.5%.
Leading the Indian pack, which IDC refers to as “emerging vendors”, was the Gurgaon-based Micromax Informatics Ltd, which had a market share of 4.8% in 2009, making it the fourth largest handset seller. For the three months to September, IDC had said that Micromax had a market share of 5.7%.
Micromax, which has been advertising heavily during the ongoing Indian Premier League (IPL) tournament, is seeking to build on its rural success and gain traction in urban markets.
Karbonn Mobiles, another local brand, has also sought to showcase itself during IPL with ads featuring Delhi Daredevils’ Virender Sehwag and Gautam Gambhir. Other local emerging vendors include Spice Mobiles Ltd, Videocon Industries Ltd and Lava International Ltd.
Micromax said its sales have been progressively climbing over the year and that the quarterly figures ended December or March would reflect a share higher than those reported by IDC.
“Our own sense was that LG’s share would be in the range of 5% to 5.5%, and that Micromax would end the year with about 7-8% market share,” Vikas Jain, one of the four co-founders of Micromax, told Mint on Friday.
IDC declined to disclose the quarterly market share data for Micromax for those two quarters.
In February, Jain had told Mint that his firm had sold 700,000 handsets in December and one million in January.
Nokia also expressed reservations about the IDC numbers. “IDC does not take into account the output from our Chennai plant,” said a Nokia spokesperson. Nokia’s Chennai handset factory, which mostly makes cheaper mass-market phones, was set up in 2006 at a cost of around $150 million (Rs677 crore today). At the end of April 2009, according to Nokia, the plant had produced a total of 250 million handsets, of which half was meant for the Indian market while the rest were exported.
Samsung could not offer its views for this story as its spokesperson was travelling. Mint was not able to reach LG for comments. Emerging vendors will make further inroads into the market, IDC said. “The mobile handsets market got even more crowded and fragmented at the lower and mid-market segments with the rise of copycat models that have looks and aesthetics resembling those of high-end smartphones,” wrote Naveen Mishra, lead analyst (mobile handsets research) at IDC India. “These copycat lookalikes are often available for as little as one-10th of the average sales value of a smartphone.”
Younger buyers will opt in greater numbers for the locally branded handsets, he said. “The adoption of these lookalikes is expected to be higher among the student and young executive segment, whose purchase decisions are often driven by peer group and lifestyle influences as well as affordability,” he added.
The Indian market is also fertile ground for manufacturers that cater to its peculiarities, such as users with multiple SIM (subscriber identity module) cards. Phones with dual-SIM capability allow a user to subscribe to the services of two cellular operators without having to use separate handsets.
For Micromax, dual-SIM models have been a big volume driver. Among the larger firms, Nokia is the only one yet to introduce such a phone. That situation isn’t going to be changing soon, the firm said. “As of now, we are not looking at the segment,” Nokia’s official spokesperson said.
Mint had reported on 8 February about Micromax challenging Samsung and LG for the third slot. A 14 December report was about Indian handset makers challenging multinational firms.