Friday, April 12, 2013

Huawei’s Smartphone Play

The $20-billion Chinese Company is a Leading Operator in The Telecom Equipment market in India, but it is for The First time making a Big Consumer push for Grabbing a share in The Handset Business.

Noticed that unmistakable trend in the handset market? Not only have smartphones become the most coveted and sought-after category in the handset business, many new players are also joining the fray. Also, customers are now spoilt for choice as they have more and varied options to choose from, which is leading to greater experimentation with new brands. As a result, top smartphone vendors such as Nokia, Samsung and LG now have a tough fight on their hands fending off competition from upstarts and new players in the game. Is it any surprise then that heavyweight telecom players like Nokia, Samsung and LG have collectively lost market share in the first quarter of 2011, while the share of lesser known players have climbed to 46.3% from 38.5% in the same period. According to technology research firm Gartner, Nokia’s market share in India fell to 25.1% in Q1 of 2011 from 30.6% in the corresponding quarter last year. Similarly, Samsung’s market share fell to 16.1% from 18% and LG’s to 5.6% from 7.6% in the same period. However, Research in Motion (RIM), maker of the BlackBerry phones managed to maintain its market share while Apple’s iPhones have been flying off the shelves. No prizes for guessing that both RIM and Apple are riding the crest of market success on the back of their smartphones sales.

Driving the demand for smartphones in India and the world has been the launch of 3G services and high speed data services. Worldwide, 427 million handsets were sold in the first quarter of the 2011 and out of that smartphones accounted for 23.6%, according to Gartner. While the industry grew by a bracing 19% YoY, the smart-phones segment grew by 85%. In India, the handset market is expected to touch 170 million units by the end of the year, as per various studies. Of that, smartphones are expected to corner more than 30% share. Analysts say that smartphones will continue to dominate the market and it’s the mid-tier market, which will lead to the mass adoption and growth of the smart-phones segment. In fact, the share of smartphones in the handset business would have been even higher but for the fact that many manufacturers who had announced a number of high-profile devices during the first quarter of 2011 could not ship their products until the second quarter of 2011. “We believe some consumers delayed their purchase to wait for these models,” says Roberta Cozza, Principal Research Analyst at Gartner.

The launch of some high-performance devices in the Indian market and also a change in the strategy by some telecom players have not gone unnoticed in the second quarter of 2011. Recently, Nokia launched its touch and type interface high-end device E-7 in the market. Similarly, HTC released its power-packed HTC Sensation for the high-end Indian customer looking for high performance phones. Research in Motion has slashed the price of its low-end BlackBerry Curve smartphone models to facilitate their mass adoption. The models are now available under Rs.10,000 price range.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
 
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