Competition leads HTC to launch sub-Rs 10k smartphones

The company jumped on the bandwagon considering 50 to 60% of smartphones sold in India are in that category

Taiwanese smartphone major HTC is venturing into the sub-Rs 10,000 price segment in India, thanks to stiff competition from Chinese counterparts in the smartphone market.

The company, which has a significant presence in the above Rs 20,000 segment, is also working to expand its retail reach and increase after sales services, Chialin Chang, chief financial officer and president of global sales, HTC, says.

The New Taipei-based company, which is considered to be the innovator of touch screen phones, was the second after Google to launch a smartphone on the Android Marshmallow OS (operating system) in India.

However, its absence in the Rs 5,000-10,000 price range meant it could not feature among the top seven players. According to research agencies, nearly 60 per cent of smartphones sold in India are in the said price range currently, where HTC is insignificant. The firm had some one per cent share in the smartphones market in terms of sales in the September quarter, according to CymerMedia Research (CMR).

According to reports, the Indian mobile handset industry is poised to become the second market after China by 2016.

The changing dynamics of the industry has led many others to readjust their business strategies, too.

Korean consumer electronics and home appliances major LG recently shifted its focus towards the Rs 10,000 price category. The Seoul-headquartered company’s India managing director Kim Ki-Wan told Business Standard LG was contemplating options to launch customised India-specific handsets for the first time in the firm’s history.

HTC, too, has identified the need of being a mass category player. It has already finalised the blueprint to remain future ready, and plans to launch “all the future devices fourth-generation/LTE ready”.

The company is set to increase its service network through 100 centres from some 40 now. “Our performance in India has a direct effect on our performance at the global level,” Chang said, emphasising on the importance India has for the company.

According to CMR, HTC has a 23 per cent share in the Rs 20,000-30,000 price range, still holding the third spot after Samsung and the Japanese electronics giant Sony. Although HTC is ready to launch in the sub-Rs 10,000 range, Chang said, “We are more comfortable in the Rs 15,000-30,000 price range.” Offering sub-Rs 10,000 smartphones will help the company gain market share by 100 basis points in the overall segment in India, to land up with five per cent share by March, Chang believes.

“We are aiming to capture 15 per cent of the affordable segment, which accounts for at least the half of the smartphones market in India,” he added.