India smartphone war heats up

16 July 2014
NEW DELHI: India is set to become a major smartphone battleground as Chinese maker Xiaomi launches a range and Google is reported to be preparing significant backing for low-cost Android One phones which will be produced by local manufacturers.

Xiaomi launched three phones pitched at each of the three broad categories in the market – flagship, mid-market and low-end – and anticipate India rapidly becoming an important market.

"We see India as a huge opportunity for us," said Hugo Barra, global vp, Xiaomi, in remarks reported by the Economic Times. "We have just started here but India has the potential to be our largest market outside of China, maybe next year."

The company plans to sell its products online, having partnered with ecommerce business Flipkart, and rather than spend heavily on advertising is looking at social media as the way it will get its message out.

Some observers were sceptical of this approach, arguing that while the company enjoyed plenty of free press in China that would not necessarily be the case in India. Further, a business model that saw the price of handsets kept low while the company made its money on the sale of accessories and applications was unlikely to work in India where people were reluctant to pay for extras.

In contrast, Google is said to be ready to invest in a Rs 100 crore push to promote Android One phones. The Times of India reported that, in "an unprecedented push by a tech company", Google would lend its support to those device makers who were committing to its software platform, including Micromax, Karbonn and Spice.

It further speculated that the launch of the $100 smartphone would take place in October when Sundar Pichai, svp/Android, Chrome & Apps, is due to visit the India.

"The smartphone market has become so competitive that you can't sneak into it, you need to enter with a splash" observed Santosh Desai, MD & CEO of Futurebrands India. "With launch cycles getting shorter, you get only one chance to make an impression," he added.

Data sourced from Times of India, Economic Times, The Hindu; additional content by Warc staff
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