CDMA handsets come of age

Nokia goes off the beaten track; LG to follow suit.

For long, it has been a poor cousin of the glamourous mobile phone industry, but with the launch of a slew of new, high end models, the battle-lines seem to be drawn in the premium CDMA handset market.

Nokia's latest model, the 6235 CDMA, is not only the second phone in the category with video-recording, but also the first sub-10k model to do so.

The Finnish company, a relatively late entrant barely a year old in the Indian CDMA segment, is planning to launch three more colour models before the year to take its line-up to nearly a dozen.

According to sources, the three models scheduled to hit the shelves this year and another one next year will be ones with features not available in any other brand, including bluetooth and extendable memory.

"We are concentrating on the entire range starting from the basic colour-screen model," says a company executive, "all the way up to a premium model with all the typical features one normally associates only with GSM models till now."

The company has successfully thrashed out a unique, operator-independent model of selling its CDMA phones after it entered the market ten months ago. This has also given it a virtual walkover as far as the high-end segment of CDMA is concerned.

"They took a risk in not depending on operators to give them purchase guarantees, as is the practice is the practice in the CDMA market in India till now," points out an industry official, "and this has paid them dividends by allowing them to introduce as many new models as and when they want."

The result is that while traditional players like LG and Samsung take nearly a year from drawing board to the operator approval to actual shipping of models, Nokia has already launched eight models in the last one year- the highest in the country.

The sheer variety, coupled with its ability to go beyond the basic, bread-and-butter models that dominate other brands, has seen Nokia's market-share go up, a fact which is weighing heavily on the traditional heavy-weight, LG's mind.

For example, the company is expected to have a marketshare of 30 per cent among Reliance's customers and around 15 per cent among Tata's. More importantly, the average value of Nokia's handsets, especially among Indicom users, is significantly higher than those of other manufacturers.

LG, which has a market-share in excess of 55 per cent among Reliance Infocomm's new customers, has only 7 percent among Indicom customers. Samsung, the only other player with any significant presence in the CDMA market, has close to none- their first model on the Indicom platform was launched only a few days ago.

"Of course, we accept that the strategy of selling through the operator has its shortcomings," accepts KK Kushwaha, VP at LG's CDMA operations in India. Kushwaha maintains that selling exclusively through operators may restrict the number and range of products, it helps open up new customers thanks to the cost advantages.

"Most of the new customer addition is taking place in the C-circles like UP and Bihar where price is very important.. and having an assured offtake and the economies of scale help us bring entry-level costs to the bare minimum," he points out.

However, according to sources, LG too is planning to make its presence in the CDMA market felt through it dealers as well, by introducing custom-made models through its own distribution network.

RINGING LOUD

Nokia is planning to launch three more colour models before the year to take its line-up to nearly a dozen

While traditional players like LG and Samsung take nearly a year from drawing board to the operator approval to actual shipping of models, Nokia has already launched eight models in the last one year- the highest in the country

LG is expected to have a marketshare of 30 per cent among Reliance's customers and around 15 per cent among Tata's