India's feature phone and entry level smartphone segment will witness a lot of action over the next few quarters in anticipation of market contraction due to the arrival of the Reliance Jio Phone sometime in September, a new report said on Thursday.
As many as 61.8 million mobile phones were shipped in India in the second quarter of 2017, and feature phones accounted for 54 percent -- a 9 percent sequential growth. Companies that make feature phones as well as brands in the entry-level smartphone segment pushed shipments during the three-month period due to concerns over Jio Phone's availability in the third quarter and beyond, according to the report from CyberMedia Research (CMR).
"The entry level market of Smartphone will see some growth primarily due to attempts by various handset makers to counter the emergence of 4G feature phones. This should also see support of incumbent operators who are seeing revenues eroding at the hands of Jio's entry into the market," Faisal Kawoosa, principal analyst for Telecom and ESDM at CMR, said in a statement.
The entry-level smartphone segment with devices priced around Rs 6,000 saw a revival during the period with 55 percent sequential growth. One of the main contributors to this growth was China's Xiaomi, which secured the No 2 position in the overall Indian smartphone market with 16.2 percent share after Samsung (18.7 percent).
In fact, several Chinese brands, including Xiaomi, Lenovo, Vivo, Oppo and iTel, showed growth in the range of 7 to 33 percent in smartphones.
The CMR report also said "there should be a replacement of certain volumes of feature phones as well as smartphones for 4G feature phone," which "could impact volume sales of feature phones in the range of 25-30 percent and for smartphones the offset could be 5-6 percent for the calendar year."
Meanwhile, India's biggest telecommunication provider Bharti Airtel is reportedly planning to launch a 4G smartphone before Diwali. Priced at Rs 2,500, the Airtel phone is expected to take on the Jio Phone, which is available for pre-booking from August 24 by paying a deposit of Rs 1,500.
Jio Phone comes with a 2.4-inch QWVGA display, a 2MP rear-facing camera and a VGA front snapper. Powered by a 1.2GHz Spreadtrum SPRD 9820A/QC8905 dual-core processor, paired with 512MB RAM, the phone also sports 4GB of internal storage, which can be expanded up to 128GB via a microSD card.
