Smartphones sale in India to be 62% of all mobile phones sales in 2018: Report

As the Indian cellular market goes through consolidation and aggressive 4G roll out, demand for smartphones will continue to grow. It is expected to account for 62 percent of all mobile phones sales in India in 2018, said research firm .

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Tech Observer Desk
Tech Observer Desk
TechObserver.in covers e-governance, enterprise IT, startups, and consumer electronics.

Smartphones in India are expected to account for 62 percent of all mobile phones sales in India in 2018, said research firm . As the Indian cellular market goes through consolidation and aggressive 4G roll out, demand for will continue to grow. With smartphone penetration maturing in many developed markets, continued growth in the world’s third largest smartphone market makes India an attractive market to device manufacturers.

“With the slowdown in sales in major markets, including the U.S., China and mature Western Europe, India represents the largest opportunity because it is the second-largest mobile phone market after China,” said Anshul Gupta, research director at Gartner.

In addition demonetisation in India through the elimination of 500 and 1,000 rupee notes caused an increased push from the government for digital currency, as well as people becoming more open to using digital payment methods.

The rise of digital currency is bringing a new use case for smartphones, which, in turn, is set to trigger higher demands for smartphones. This opens the opportunity for service providers to launch mobile wallet solution or even vendors to launch their exclusive mobile payment solutions like Android Pay or Apple Pay to build an ecosystem.

Smartphone unit sales as a percent of overall mobile sales in selected markets, 4Q16

Country Smartphone penetration of overall mobile phone sales (%)
China 96
India 50
US 96
Indonesia 68
Brazil 92

Source: Gartner (March 2017)

Leading global vendors, Samsung and Apple, have made exclusive plans to grow their shares in the market. Major Chinese manufacturers, such as Gionee, Huawei, Oppo, BBK (Vivo), Xiaomi, Lenovo etc., have committed big investments to exploit the growth opportunity.

Ever rising competition from Chinese manufacturers has not only troubled top local brands such as Micromax, Intex, Lava and Karbonn mobile but also resulted in a decrease in smartphone market share for Samsung in India.

“With an exclusive focus on the market from the device manufacturers, we expect more customised smartphones to come to market and remain key to win in this highly competitive market,” said Gupta.

 Top smartphone vendor share by unit sales to end users in India

Smartphone Vendor 2014 2015 2016
Samsung 24.4% 21.2% 17.3%
Micromax 18.3% 16.7% 11.9%
Lenovo 1.6% 7.3% 8.1%
Intex Technologies 2.9% 10.1% 6.9%
Karbonn Mobiles 11.6% 3.4% 5.2%

Source: Gartner (March 2017)

As opposed to earlier falling mobile phone average selling price (ASP) trends led by the rush to low cost mobile phone, we have noted a change in consumer spending. Our recently concluded consumer survey showed, users are willing to spend more to get a smartphone with better features than simply rushing for lowest price smartphones.

“The growing ASP trend will be maintained in the coming years with the increasing middle class population and rising per capita income leading to more disposable income to be spent on electronic goods,” Gupta said.

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