Indian Handset Brands Grab 14% Market Share

Local Brands and Samsung grow at Nokia's expense

Nokia loses 12% share, remains market leader with 52%

Max, Micromax, Karbonn, Lava, Lemon, Spice added up to 14% market share by revenue in India's mobile handset market in 2009-10. Samsung added 7% share

Indian mobile-handset brands strengthened their presence in the domestic handset market in 2009-10, adding up to 14% market share by revenue, according to the V&D100 Indian Telecom Survey conducted by CyberMedia telecom journal Voice&Data. This is up sharply from about 3-4% total share by these brands in the previous year.

The Indian brands included Micromax (4.1% handset market share by revenue), Spice (3.9%), Karbonn (3%), Lava (1.1%), Lemon (1%) and Max (0.9%). Compared with last year, these Indian brands gained a cumulative 10 percentage points of market share in the very competitive Indian market, and Samsung gained 7 points, as Nokia lost 12 percentage points share. The handsets in question are locally branded models sourced from manufacturers in China or Taiwan. (See chart at end. All market share is by revenue.)

Why the big gain by these brands? “Low prices for perceived high-end features,” said Voice&Data chief editor Prasanto K Roy. “You get all-QWERTY Blackberry look alikes complete with trackball, and even dual-SIM phones, for Rs 5,000. We saw demand rising for dual-SIM phones last year, but the market leaders had few offerings there. And while Nokia has many low-cost models, they are relatively sparse on features.” Yet the low-cost local brands don't beat the market-leaders in all areas, he added.

“Where they may fall short is in applications and functionality, user interface and experience, and, often, quality of construction, solidity and robustness,” Prasanto said. “But with the short life cycles of handsets today, many buyers are willing to experiment.”

The mobile handset market grew 4.2% by revenue during FY 2009-10 (compared with 7.9% in 2008-09, and 11.9% in 2007-08). The low revenue growth hides the large numbers sold, but reflects the fact that most sales are of low-priced handsets, and that the average sale price (ASP) has been dropping each year.

Around 108 million mobile phones were sold in the country during 2009-10, adding up to Rs 27,000 crore in sales, up from Rs 25,910 crore the previous year.

And growing even more than the handset numbers in 2009-10 was the number of mobile subscribers. The country added 192 million mobile subscribers in the fiscal. A large number of subscribers have more than one SIM card, and an increasing number are in fact using dual-SIM phones.

The Voice&Data100 annual survey on handset is based on the revenue of telecom equipment suppliers, including GSM and CDMA handset vendors.

Handset major Nokia remained the market leader with 52% share, despite a 15% revenue dip to Rs 14,100 crore (down from Rs 16,567 crore in 2008-09). The Finnish giant's share was gobbled up by the Indian-brand handsets, and by Samsung. Nokia launched 22 devices during the year, selling them though over 200,000 retail outlets across the country (with 45% in rural India), and supporting them with over 700 service centers across 400 towns and cities. But its services thrust diluted its focus on handsets.

Samsung remained the second largest handset vendor, with 17.4% market share, followed by LG at 5.9%. Sony Ericsson slipped badly last year, with very few options in the low- and mid-range handset segments.

About the V&D100 Indian Telecom Survey

Voice&Data's annual V&D100 Indian Telecom Survey is the oldest and most comprehensive survey of the Indian telecom equipment and services industries. It is an annual survey in two parts, the telecom services survey in June and the telecom equipment survey in July, the two adding up to a complete picture of the Indian Telecom Industry. Voice&Data, published by CyberMedia, is India's leading telecom publication for the past 16 years, and is available online at www.voicendata.com.