A quick snapshot of the year that went by tells us that smartphone sales in India grew approximately 105% (year-on-year) in 2013 to reach 41 to 43 million units i.e. 4.1 to 4.3 crores.
Also, for the first time in Q4 i.e. Jan-Mar, monthly sales crossed 4 million units i.e. 40 lakh units. And all this when smartphones still form less than 30% of total mobile devices volume sold in India in 2013 but contributed to over 75% of top-line growth for the industry.
Here are some of the insights provided by Convergence Catalyst, an Indian Telecom Research and Advisory services firm
Smartphones in India
South Korean giant Samsung was the market leader for the entire 2013, though it lost around 12-15% from its peak in mid-2012.
The year was a bountiful one for local players gone national, namely Micromax, Karbonn, Intex as their Average Selling Price was far lower than the ‘branded’ ones.
But many of them have struggled to get good market share in >USD 150 (appr. Rs 9000) segment. In the $150+ segment i.e. upwards of 10k in Indian rupees, Samsung, Apple, HTC and Nokia ruled the roost. Yeah, Nokia had a surprise package in the form of Nokia Lumia 520 which is still a best seller.
Tablets in India
Approximately 3 to 3.5 million tablets i.e. 30 to 35 lakh units were sold in 2013 in India. Tablet growth is slow as compared to smartphones as it is not getting enough push from the manufacturers or sellers and there is lack of understanding of the device value proposition by mass market consumers.
And most tablets need 3G or WiFi to perform the best, something which the ecosystem is yet to fulfill. In fact, online retailers promoted tablets much more than the brick-and-mortar ones!
The year ahead – 2014
Smartphone sales are expected to reach a mindboggling 60 million, accounting for almost 40% of all mobile handsets sold in India this year. The growth rate may slightly go down due to the large base of 2013 plus slower than expected decline of smartphone prices as they have been till now.
Samsung is expected to be Numero Uno but with yesteryear giants like Nokia coming up with Android bundled Nokia X and the subsequent X+ and XL, it will be the battle of the best. It is interesting to note that Nokia’s increased market share is expected to come primarily at the cost of domestic brands as opposed to global brands.
Also, rate of smartphone price decline is expected to slow down in 2014, with the entry-level smartphone prices expected to settle at USD 40 (Rs 2400). Trends such as Flipkart’s exclusive partnership with Motorola for selling Moto G and Snapdeal’s exclusive partnership with Intex for selling Aqua Octa are expected to gather more steam in 2014.
E-Commerce players have emerged as strong distribution channel for smart devices, especially smartphones, in India. Their no-frills operations, lean supply chain, direct access to consumers and growing brands make them the preferred partners for many smartphone OEMs. We shouldn’t be surprised if a few e-commerce firms come out with their own branded smartphones [Update: Flipkart becomes first online retailer to have their own branded phones.].
Tablets will reach 5 million units at a moderate growth. Still not too much in fashion, the education industry will be pushing its adoption with sales reaching upto 250k devices!
Let it be smartphones or tablets, until the ecosystem of 3G or WiFi flourishes around, the sales are not expected to touch sky high.
Rates also will come drastically down when all other factors support the volume growth. Plus the increasing trends of flipping phones for every other new model. What do you say?