Indian smartphone sector heats up

13 August 2009

MUMBAI: Competition in the Indian smartphone market is intensifying, as the major multinational manufacturers increase their focus on the country's rapidly-growing mobile user base.

It is estimated that there will be 6 million active smartphones in India by the end of this year, giving the category a value of some 7,800 crore rupees ($1.6bn; €1.1bn; £980m).

Apple launched the iPhone, currently a market leader in the US, in the Asian country in August 2008, in separate partnerships with both Vodafone and Bharti Airtel.

While the consumer electronics company has not released specific figures thus far, it is estimated that iPhone sales in India had not reached 50,000 units by the end of May.

Price is one major barrier to an increased rate of uptake, with slow download speeds and the specific demands of consumers in the country said to be among the other factors contributing to this trend.

Sanjay Gupta, cmo of Bharti Airtel's mobile arm, argued earlier this year that there is also "a big functionality issue" at play with the iPhone, which is being "judged as a phone, not as a data device."

Apple will introduce the iPhone 3GS in India in the near future, promising faster downloads, video recording facilities and several other new features.

Nokia currently sells devices across a variety of different price points, with the E-series, one of its newest products, costing 12,500 rupees at present.

Vineet Taneja, Nokia's marketing director in India, said "studies have indicated that touchphones will account for nearly 40% of the Indian market by 2012. This represents a huge opportunity and we too will evolve our portfolio accordingly."

HTC, the Taiwanese telecoms firm, is also planning to add its Magic handset, which runs on Google'sAndroid operating system, to the growing number of options in this sector.

Bharti Airtel will have exclusive rights to sell this wireless phone in its home market, with the price tag estimated to reach 25,000 rupees.

One challenge facing Magic it that its equivalent of the iPhone's App Store is currently not operational in India, which may cause some consumers to opt for alternative models.

Jack Tong, vice-president of HTC Asia Pacific, said "the response that Android mobiles have received worldwide was at times even beyond expectations and we expect something similar in the Indian market."

Earlier this month, Research in Motion launched the Blackberry Curve 8520 in India, also in partnership with Bharti Airtel, and which will cost 15,990 rupees.

Data sourced from Televisionpoint/Economic Times; additional content by WARC staff