Why Low Priced SmartPhones Key for 3G Data Uptake in India ?

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 parts of the smartphone market has been the fact that local vendors have been pushing cUSD100-150 price range, while global players have been more present in the USD150-200 range. According to IDC, Samsung is the still the number one in the Indian market with a 26% market share, followed by Micromax with a 22% market share and Karbon with 13%. The interesting part is that 29% of the Indian smartphone market is dominated by other companies, which account for 29% and include brands like Apple, Lava, Intel and others. We estimate a significant improvement in low-cost / high-quality smartphones in the USD50-100 range.