Indian handset makers are taking on global brands with cheaper, feature-rich products, to increase their share of the mobile market. With a mobile subscriber base of over 700 million, India has become the battleground for handset manufacturers. Apart from major multi-national brands, almost 50 handset manufacturers have set up shop in the recent past to grab a share of the market. The arrival of these new entrants has redefined the phrase: Innovation at the bottom of the pyramid. The handsets are cheaper, starting at Rs ,900, with features that could give established brands a run for their money.
The new kids on the block – Lava Mobiles, Maxx, Intex, Zen, Micromax Mobiles and Videocon, among several others – are eager to take on the challenge to satisfy the domestic mobile audience with features and applications that suits their interests best. These companies claim to have research and development teams who work overtime to try and gauge how the Indian mobile user is different from consumers in other parts of the world and come up with solutions to cater to their needs.
Sample this: Spice Mobility has launched its first 3D mobile phone, with dual SIM for Rs 4,299. Intex has a video chat-phone with dual camera. The company also launched a projector-integrated mobile phone at Rs 13,000. Maxx introduced an Android-based phone with an 8GB memory card that is priced at Rs 6,999. Videocon has launched a sport phone, the V6200, with superbike makers Ducati. Videocon’s dual battery phone, the V1603, the company claims, works even when the main battery is discharged and can still offer standby time of 50 hours on the back up battery which can be switched on with the help of a Toggle Key.
The list grows bigger by the day. No wonder, users have started taking to these brands over market majors Nokia, Ericsson and Samsung. Take the case of Nishit Marakandeye, a Delhi-based engineer working for IBM India, who uses an Intex phone after he lost his Nokia E63. “Frankly the first thing that attracted me was the price. I had just lost a high-end and expensive Nokia E63. But having used this I think, my Intex phone is really good.” He is now waiting for a 3G connection, to use the dual-camera feature on his phone for video chat.
Harshita Nair, a Bangalore-based IT professional, took to a India-made handset by chance, but now seems to be liking it. “I received my Micromax Q5 as a gift. Before this I was using a Nokia Express Music. I have been using this phone since February and I think it has got all the features that I would get with any other high-end phone.” The best feature, according to her, is the battery back-up that she gets with a MicroMax. “A fully charged battery lasts me three days. That is what matters to me more,” she said.
While the Indian mobile handset manufacturers like Spice Mobility, Micromax, Maxx, Intex, Lemon and others are yet to make a huge dent in the market share of the global players, they are certainly inching towards it. Delhi-based Spice Mobility, the first Indian firm to enter the mobile handset market, registered sales of five million last year and is expecting to log sales of at least 7-8 million this year. “Other than the investments we have made in creating an eco-systems for our brand, we have focused on innovation and features. When we launched our first phone in 2005, we were perhaps the only one then in the market to give Bollywood music embedded into the handsets. Users did not have to pay anything extra. For us our 800 stores are sounding boards for what the customer is looking for,” said Kunal Ahooja, CEO and director of Spice Mobility. With product teams in India and China, the company at present is working on a dual SIM Android phone and a tablet PC.
While Ahooja said Spice Mobiles has never used price as a strategy, for many users this has become a key factor. Alka Raina, a 49-year-old MTNL employee opted for a local brand for its pricing and feature. “Six months ago I was looking for a dual SIM mobile phone, but none of the big players had anything to offer. So I bought a MicroMax Q75. For Rs 5,500 this was the best. The voice quality is good, it does not hang and also looks good.”
Maxx Group, which officially launched in July 2009, said that within seven months it registered sales of 2.3 million handsets. “For us it is about variety. At present we have 47 models that range from as low as Rs 1,100 to Rs 8,000. In India mobile phones have become a commodity product. People prefer to buy phones from Indian manufacturers as the resale price is good. Since most of the phones are cheap, the resale value is better than what one gets on multi-national branded phones,” said Ajjay Agarwal, CMD of Maxx. The company signed up M S Dhoni as their brand ambassador.
Intex believes that there is a market for low-cost reliable phones for both rural and urban Indian. A couple of months back, when Intex launched its dual SIM video-chat phones it had not expected sales figures for the IN4470 (Rs 2,990) would touch the 2.5 lakh mark. “We have a team of 30 engineers who work on the product side. Our target is to bring new models every six months,” said Ramesh Vaswani, executive vice president, Intex Technologies.
Intex has also launched Intex Zone to introduce new applications. “As of now we have about eight applications. We also have a tie-up with Smile of India for its application Zoomi. Intex, is also working on a technology for noise calculator that will allow users to eliminate background noise, at a touch of a button.
Lava Mobiles targeted users who were not comfortable with the QWERTY keypad. Lava launched the Alpha keypad that arranges the keys in the order of the English alphabet. Co-Founder & Director of Lava Mobiles, S N Rai said: “In one of the consumer researches earlier this year, we realised that QWERTY keypads were actually confusing an average user in non-metro locations.” Since then, Lava has sold over 100,000 Alpha keypad handsets that cost around Rs 4,300. They have also seen similar success in its multi-lingual handset Lava KKT 15 that comes pre-loaded with 12 Indian languages: Hindi, Marathi, Bengali, Tamil, Punjabi, Telugu, Gujarati, Kannada, Urdu, Malayalam, Oriya, and Assamese. Priced at Rs 2,899, these phones allow the rural and semi-urban users to communicate in local languages.
Handset upgrade for 3G
According to a study by The Nielsen Company, among the urban subscribers who intend to adopt 3G, 63 per cent plan to upgrade their handsets. Is that an opportunity? “Anyone who has a 2G handset and would want to move to 3G networks is a potential customer,” said Sandeep Mushran director of Lemon Mobiles, which has launched a 3G handset at Rs 3,500. Similarly, Maxx plans to launch 3G phones with a price range between Rs 4,000-5,000. Maxx said they are eyeing 10 per cent of the market share in the next 10-18 months, from four per cent now.
Anticipating the changes in customer use, Rai of Lava Mobiles signed a three-year deal with National Geographic to pre-load its content on devices. Rai said: “With this association, Lava handset users will have free access to wallpapers, video content, web-based information and ringtones of the National Geographic Channel.” Mushran of Lemon, who believes that after-sales service will be critical, is ramping up service centres from 400 to 450 in the next two months and mulling over a production facility in Noida to control handset costs. “We anticipate that Indian users will take to video chats on 3G, so we have introduced a dual camera 3G phone that costs Rs 3,500,” he said.
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