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Smarting Giants: Indigenous smartphone makers are eating into the market share of Apple et al in India & China

Aug 05 2014, 01:23 IST
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SummaryIndigenous smartphone makers are eating into the market share of Apple et al in India & China.

The tide is turning in the global smartphone market. Not for sales—these remain strong with shipments reaching 295.2 million in Q2 2014, as per IDC data. The turn we speak of is in how the market is sliced between smartphone makers. Apple and Samsung, still the market leaders, have ceded space to Chinese makers Huawei, Lenovo and Xiaomi. For Apple, this is a double whammy. Though iPhone sales have increased globally, the Chinese smartphone surge has left Apple’s iOS a distant second to Google’s Android, the operating system that these phones use. For Samsung, which saw a 1.5 million unit yoy drop in sales, this brought with it the worst quarterly earnings the company has seen recently.

Why is this happening? The surge is because indigenous makers are increasingly becoming popular in China and India, the two largest smartphone markets in the world. Very recently, Xiaomi debuted in India, with Mi3, and saw an overwhelming response from the market. In India, domestic makers like Micromax, Karbonn and Lava are also riding strong. Key to such success, be it of the Chinese or the Indian makers, are the pricing points for their models which simply choke competitors’ sales. Take Apple, for instance. It did manage to report stronger sales in India, mostly on the back of the re-introduction of the iPhone 4, the cheapest model it offers in the country. But at R22,290, Apple’s cheapest costs way more than say, a Micromax model with comparable specs. And given how Microsoft is making a bouquet of its software, including its OS, free for budget smartphones, and how Mozilla is partnering Indian makers Spice and Intex for a R1,500 model, it looks like indigenous makers will keep riding the crest of the smartphone tide.

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