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28 New Handsets Vendors In India in 2009, Nokia Continues To Lead

(By Diwaskar Chettri & Nikhil Pahwa)

The handset market in India continues to fragment, with as many as 28 new handset vendors in 2009, according to a report by IDC India. What would worry market leader Nokia, which led with 54.1 percent of units sold in 2009, is that the new vendors accounted for as much as 12.3 percent of the shipments to the Indian market in 2009. Many of the new vendors, in particular Maxx and Karbonn Mobiles have upped marketing spends in the last quarter, particularly during the Indian Premier League, India’s Superbowl for promotions.

Note that IDC calculates sales of mobile handsets by tracking the number of handsets that leave the factory premises for OEM sales or stocking by distributors and retailers. For imported handsets it’s the number of handsets that leaves the first warehouse to OEMs, distributors and retailers. It does not account for handsets brought in by individuals into the country or the grey market.

While the impact of increased promotion in Q1 this year is yet to be seen, the last quarter of 2009 should be indicative of a trend of growing fragmentation: new vendors accounted for 17.5% of total sales for October-December 2009, up from a minuscule 0.9% held by 5 new vendors in January-March 2009.

Nokia’s lead is massive, with Samsung at number two at 9.7% share, and LG at number three with a 6.4% share for the year ended December 31, 2009. Earlier IDC had reported that for the 12 months ended June 2009 Nokia, Samsung and LG had a market share of 56.8 percent, 7.7 percent and 5.4 percent respectively.

In 2010, expect bloodshed as margins drop, particularly at the lower end of the market, and prices are pushed down by launch of more and more Android driven handsets at the higher level from Samsung, HTC and LG. Naveen Mishra, lead analyst, mobile handsets research for IDC India appears to concur, expecting further fragmentation at the lower- and mid-market segments with the rise of ‘copycat’ models that resemble high-end smartphones and cost one-tenth of the average sales value of a smartphone.

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India Mobile Handsets Sales Up 6.7%, Many New Vendors: IDC India

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