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Date: 24-09-13

Rapid growth of smart phone and tablet due to low-cost Android devices

Since from three years, announcement of low-cost Android smartphones is a normal thing in Indian market. With in a week one or the other low-cost Android phones or tablet computers are launched. Good thing is, while the performance is increasing the cost is falling. There are number of smart phones and tablet computers available in the range of Rs.5000 to 16,000 ( US$90 to US$250). The Indian brand Micromax is on the verge of becoming India's number one smartphone vendor. Though at high-end people prefer Apple's iPhone and Nokia's Lumia, but most of the buyers who have limited budget go for Indian brands such as Micromax, Karbon, and Spice and if their budget allows they go for mid-range brands such as Samsung and LG. This trend expected to continue for some more time, until the domestic manufacturing picks up.

Frost & Sullivan has forecasted smartphones and tablet market in South Asia (which includes India Sri Lanka Bangladesh) is expected to reach US $33.33 billion in 2019 from US $4.45 billion in 2012. India can be estimated to have around 80% of the share in this forecast.

To give you an idea and Tablet market: CyberMedia Research has reported over 1,150,000 Tablets were sold (shipped) in the quarter by as many as 70 domestic and international vendors. However, only thirteen vendors shipped in significant volumes of more than 20,000 units during the period. The overall growth in shipments of Tablets in the India market registered an 107.4 % year-on-year (2Q CY 2013 over 2Q CY 2012) growth, but a more moderate 27.2% quarter-on-quarter (2Q CY 2013 over 1Q CY 2013) increase due to seasonal factors.

“It will be interesting to see if there are any significant shifts in Tablet shipments in the forthcoming quarters. With the requirement for mandatory adherence to BIS certification it will be difficult for vendors who do not get their products BIS-approved to sell in India. This may lead to some consolidation in the India Tablets market in the short- to medium-term,” Tarun Pathak, Analyst, CMR Telecoms Practice.

The Indian brands most of the times import phones and tablets mostly from China. Government is trying best to support domestic manufacturing of mobile phones and the components used in mobile phones including semiconductor ICs. Two semiconductor fabs are expected to start producing chips in India 2 to 3 years from now. Government has also charging 6% duty on imported mobile phones costing more than US$ 40 to support domestic manufacturing. To protect Indian customer from poor quality electronic devices, BIS certification is must for many electronic products in India, including smart phone and tablet.

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