Mobile phones have increasingly become more than a communication device – 40% of the respondents in a survey across urban/ semi-urban and rural areas claim that it is currently their primary means of entertainment. While people are upgrading their phones to smartphones and increasingly using their phones to watch videos, listen to music or take photos, having a smartphone does not equate to having a mobile data plan yet. People quite frequently buy pirated content (videos/ music) from local retailers; which is then shared among friends. Moreover, the rise in the number of people that have smartphones, but no data subscription is leading to the growth
Many Mobile apps now offer either voice messaging (Wechat) or straight VoIP functionality (Skype, Viber, Line). While it is difficult to prove a direct linkage between usage of these apps and usage/revenue trends within the traditional telcos, there is at least anecdotal evidence that, on average, rising 3G / 4G penetration rates are usually associated with falling voice minutes of use.
We do not attempt to prove that messaging apps are cannibalizing voice. Instead, we attempt to quantify the cost savings to users (and therefore the voice revenue risk to operators) were subscribers to move their current voice usage over to a VoIP data based pricing model.
Compression ratios for the various CODECs used by VoIP providers vary, but we understand the most frequently used is the G.729 CODEC. Adjusting a minute
The Indian Mobile Handset Market is set for a Big Leap in 2014. The handset market currently is almost entirely replacement market. Encouragingly, there appears to be a constant upgrade cycle toward smartphones and the company believes that over next three-four years, the feature phone segment is likely to diminish significantly.
e-commrerce Mobile Retailer Vs Store Retailing in India
Ecommerce companies, especially the ones with “marketplace” models, are currently the most aggressive on the ground. Organized retailers comprising national players like Mobile Store, Spice, Univercell, Reliance digital, Next, Hotspot, etc. and brand outlets (example Nokia Priority) are finding it hard to compete with the e-commerce retailers – e-bay, Flipkart, Amazon, Snapdeal, etc
One of the key drivers for the Indian data growth story will be the availability of low-cost smartphones. We understand that c18m smartphones were sold last year in India and c25-30m smartphones are expected to be sold this year.
There has been significant progress already made, we believe the critical milestone will be when major brands such as Samsung, Micromax, HTC and Nokia are able to launch fully functional smartphones in the USD50 range. At present average price range in the branded smartphone segment is between USD175-500. We do believe that over the next 2- 3 years, India will be a market for refurbished whitebox smartphones as well.
One of the interesting moving
3G business in India currently has negative returns, but should turn positive by F2016. Airtel and Idea reported sequential nonvoice revenue growth of 5% and 13%, respectively, in F3Q13. Operators have been inching up their 2G data tariffs, while 3G data tariffs have come down by ~7x since the beginning of 2012. Data volumes in … Read more
Many are still under the impression that whitebox market smartphone are of low quality and are barely usable. The business have started to change their mentality and focus more on quality. During our multiple trips to China in the past 6 months, we’ve witnessed a huge improvement in whitebox smartphone quality. With better economy of scale, prices also have come down very rapidly.
Most consumers are willing to pay a premium for branded products over Chinese brand / whitebox smartphone, especially in the mid to high end segment. However, we believe that in the sub US $200 segment, whitebox makers can offer similar form factor design but much better hardware specifications at lower prices. As such, it’s extremely difficult for branded players to compete with whitebox makers.
It is apparent that local smartphone brands gained share from foreign brands in 2012. Although Samsung remained the market share leader throughout the year, local brands, especially Lenovo, made significant progress. At the end of 2012, local brands’ combined market share was 61%, and we expect this to edge up to 66% in 2013, as brand names outgrow whitebox players.
As Operators derive higher profits from local brand smartphones than from Apple / Samsung smartphones local brands are likely to gain more subsidy share, even though overall operators’ subsidies could remain flat. Further, a successful flagship model also helps promote brand image, thus increasing sales volume across the product line. Notably, all flagship models (quad-core, 4”+ touch display, 8MP, etc.) from local brands are priced at below USD 600.
Acer has kicked off 2013 smartphone line-up with three new smartphones including Liquid E1, Z2, and C1. The detailed hardware specifications are still emerging. Initial feedback on pricing is interesting, in our view. It is reported the E1 will have a retail price for €199-299 and the Z2 for €99-129, suggesting Acer is attacking the … Read more
Asus will soon launch Padfone Infinity and FonePad. The Padfone Infinity is the third generation device in the Padfone series, and is a smartphone with an integrated docking tablet. The key upgrade in Padfone Infinity to its predecessor is the use of QCOM’s Snapdragon 600 Quad-core CPU (1.7GHz), and larger 5″ display. FonePad is a 7” tablet with 3G voice (i.e., phone) functionality, but is more akin to a tablet, in our view. FonePad is Asus’ challenge to Phablets.
ZTE launched only one high-end smartphone versus eight models a year ago.