NEW DELHI: The Indian phone industry is set for a disruptive 2017, with consolidation and re-entry of brands expected, while new smartphones offering better specs at lower prices come into the market.
The disruption will follow a year that recorded 22% increase in revenue over last year, Cybermedia Research said Tuesday.
"There would be major knock offs and the industry will see consolidation. 2017 is going to be a disruptive year as vendors come out with their unique propositions such as more RAM, higher battery capacities, among others," analysts at CMR said.
"The re-entry of Nokia in smartphones and exist of smaller players will be some of the important factors driving the Indian Mobile Handset Market. In a nutshell, 2017 is going to be a ‘Do or Die’ year for many of the brands," the firm said.
As per CMR’s India Annual Mobile Handset Market Review, the market recorded a 22% rise in revenues at Rs 1,359,975 million in 2016 as against Rs 1,117,571 million in 2015.
Samsung garnered 33% market share during the year with its revenues standing at Rs 453,713 million, followed by Apple (8%) and Lenovo (7%) with Rs 112,975 million and Rs 99,806 million revenues, respectively.
The 4G revenues of the industry have doubled on-year to Rs 992,74 million in 2016, while 3G declined by about 60% to Rs 165,978 million. In CY 2016, 4G constituted about 69% of total smartphone shipments, while 3G was 29%. In CY 2017, 4G is all set to cover near 100% of Smartphones.
CMR predicts that this year, the buzz would be around making the feature phones smarter with upgraded cameras and introduction of new features.
"The 4G-capable feature phone is, however, going to cannibalize the below Rs 5,000 smartphone market," it added.
Although, the revenues from feature phones constitute a very small chunk of around 14%, in terms of volume they hold about 57% of the market. Overall, there’s a scope to play around feature phones and brands like itel, Zen and Ziox would get aggressive in this space.
In terms of technology, 4G is going to be synonyms to smartphones. Feature phones would be here to support the voice-centric market.
The war between Indian brands - Micromax, Intex, Lava, Karbonn- and Chinese brands -- Lenovo, Oppo, Vivo and Xiaomi -- is going to be aggressive.
In terms of volume the total market share of Indian brands stood at 35%, while for Chinese it was at 10%. However, in terms of value, Chinese brands managed to beat their Indian counterparts, with the combined revenue of former standing at 22% as against 17% of latter.
Indian brands need to brace themselves up for a terrific war against the Chinese players, the firm added.
Indian players would look forward to Rs 6,000-10,000 smartphone market, where they will primarily fight it out with Xiaomi and Lenovo, having wide portfolio in this segment as well.
The Rs 5,000-10,000 market is going to see some new specs and upgrades.
In the premium segment, new models of Samsung, Apple and OnePlus would be worth to watch.
‘Make in India’ has provided the right impetus to the mobile manufacturing in the country. Today, about 66% of the total shipments are domestic manufacturing, in 2017, the share would touch 90%.
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