JioPhone impact: Entry-level smartphones to see more action in next quarters

CyberMedia Research's (CMR) latest report predicts a stronger buzz in the entry-level smartphone market in India due to Reliance's JioPhone. The report further says that 61.8 million mobile phones were shipped in the second quarter of 2017, of which 54 per cent were feature phones, witnessing 9 per cent sequential growth.

Reliance JioPhone to improve prospects of feature phones, entry-level smartphones in India

"As the JioPhone launch looms, the prospects of feature phones as well as entry-level smartphones brands aligned to these markets pushed the shipments in wake of anticipated contraction of the market due to Jio Phone availability in 3Q and beyond," the CMR report stated.

CMR announced that with several Chinese brands like Xiaomi, Lenovo, Vivo, Oppo and iTel showing growth in the range of 7-33 per cent in smartphones, the focus is now all about competition among these brands to occupy the leading positions in the market.

"As smart phones complete its first decade in India, Samsung will continue to enjoy the market leadership, 6th time in a row," said Thomas George, Senior Vice President and Head, CMR.

Xiaomi was among ace performers in the quarter, not only taking it to No 2 in the Smartphone market in India but also contributing to the revival of ₹4,000-₹6,000 price segment that witnessed 55 per cent growth sequentially.

"The entry-level market of smartphones will see some growth primarily due to attempts by various handset makers to counter the emergence of 4G Featurephones. This should also see support of incumbent operators who are seeing revenues eroding at the hands of Jio's entry into the market," added Faisal Kawoosa, Principal Analyst, Telecom and ESDM, CMR.

The price segment of ₹8,000-₹10,000 should also see some upward trend as a lot of 3G owners would want to go for a 4G upgrade.

"At present, of estimated 350 million smartphone users, 150-160 million have a 4G Smartphone opening up a huge opportunity for sub ₹10,000 price category 4G smartphones. This will be targeting late adopters as well as the technology leggards," Kawoosa added.

According to CMR, the market will be pretty flat for the year. However, there should be a replacement of certain volumes of feature phones as well as smartphones for 4G featurephones.

This could impact volume sales of feature phones in the range of 25-30 per cent and for smartphones, the offset could be 5-6 per cent for the calendar year, the report said.