India's overall handset shipments in the first quarter of 2014 (Jan-Mar 2013) reached the 58.9 million units mark, recording a year on year growth of 8.9 per cent, according to a report released by CyberMedia Research (CMR). However, the handset market saw a quarter-on-quarter seasonal decline of 16.4 per cent during the same period.
While the smartphones segment recorded a 219.4 per cent Y-o-Y growth and Q-o-Q growth of 1.9 per cent, the feature phone segment witnessed negative Y-o-Y growth of -6.5 per cent.
Note that CMR uses the term 'shipments' to describe the number of handsets leaving the factory premises for original equipment manufacturer (OEM) sales or stocking by distributors and retailers. In the case of handsets imported into the country it represents the number leaving the first warehouse to OEMs, distributors and retailers. CMR does not track the number of handsets brought on their person by individual passengers landing on Indian soil from overseas destinations or 'grey market' handsets.
Samsung is King
In the quarter, Samsung overtook Nokia in overall handset shipments to become the leader with 20.3 per cent market share. Nokia followed in at second position with 17.6 per cent market share, while home grown handset and tablet manufacturer Micromax completed the top three with 11.2 per cent.
The company was already the market leader in the smartphone segment of the market, but wasn't able to catch up to Nokia when it came to overall handset shipments, until now.
"Nokia's slip down was inevitable as the vendor's smartphone portfolio came very late and hasn't been able to impress the potential customer base to a large extent. At the same time, Samsung continues to serve all the price segments of the market very well. With 'Asha' portfolio, Nokia tried to create a new segment of smart featurephones and that did help Nokia to record an impressive share in the featurephones segment. But as newer companies, particularly the domestic brands, came out with disruptive propositions, the concept of smart featurephone seems to be dying," said Faisal Kawoosa, lead analyst, CMR Telecoms Practice.
"In hindsight, it may be said that Nokia did not capitalise on the gains from the strategy of creating the new sub-segment of smart featurephones, by not making the next upgrade available for such consumers. However, this opening was very well exploited by its more nimble-footed competitors, who have witnessed an upsurge in consumers buying their smartphone offerings. In a sense, Nokia's smart featurephones really helped other brands push up the sales of smartphones in India," he further added.
Indian smartphone market
The smartphone shipments crosses the 14.5 million units mark, while the Indian smartphones market during the period saw a marginal growth in shipments of 1.9 per cent over Q4, CY 2013- taking the contribution of smartphones to overall shipments to 24.6 per cent. Note that as many as 68.3 per cent of the smartphones shipped in the country during the first quarter were 3G-enabled devices.
Samsung continued its dominance over the smartphone segment in India with 43.2 per cent market share. Interestingly, Nokia did not even feature in the top three positions, which were filled by home grown manufacturers Micromax and Karbonn with 17.5 and 5.2 per cent market share respectively.
"Going forward we can expect the India smartphone operating system war to heat up as Microsoft recently waived the Windows Mobile licence fee for devices less than 9 inches screen size. This is expected to help bring more Windows Phone 8.1 device offerings into the market from OEMs who want to use Windows Mobile as the underlying OS. It will be interesting to watch how consumers in India react to the Windows Mobile offerings from vendors like Micromax, Karbonn, Lava and others, who are likely to launch their Windows Phone 8.1 devices shortly," said Tarun Pathak, analyst, devices, CMR Telecoms Practice.