India's mobile manufacturers go rural

Domestic mobile handset makers in India are focusing on rural markets to boost sales in a bid to scupper competition from mobile giants such as Nokia and Samsung.

Around 108 million handsets were sold in the country during 2009-10, and according to the Business Standard, industry experts predict around 10 million handsets are sold in the country every month. However a huge 8.5 million units are from massive mobile manufacturers.

“Indian mobile handset market is flooded today. In such a scenario, maintaining the trust of consumers has become a key challenge,” Indian Cellular Association President Pankaj Mohindroo told PTI.

He said it was important for domestic brands to offer special features at cheaper costs to make them more attractive to people.

MVL, a recent entrant into the market, shared the view.

“Our target is the smaller cities and rural towns as these regions present a huge opportunity. Even today, more than 500 million people don’t have a mobile phone,” MVL Telecom Director Arjun Rishi told the Business Standard.

However, Indian manufacturers aren’t doing so well with manufacturers such as Spice, Micromax and Karbonn picking up around just 14 per cent of the mobile phone market in India.

Micromax had a 4.1 per cent market share by revenue, Spice and Karbonn had a share of 3.9 per cent and 3 per cent in FY 2009-10, respectively.

Others such as Zen Mobile have tried a different tack to break into the market, launching phones with a 72 day battery back-up to tackle the problem of inconsistent electricity supply in some rural areas.  

Others have tried to break into the Indian handset by focusing on providing a feature-rich handset at an affordable price as well as a good after-sales service, he added.

While the Indian rural mobile phone market is growing, broadband is still slow.

According to research by the Internet and Mobile Association of India, 84 percent of Indians living in rural areas are completely unaware of the existence of the web. It found the main ways to go online in rural areas was through access points and cyber cafes. If the networks are there, 2G and 3G could be a way forward.