Mobile phones in INDIA
Mid nineties, INDIA saw its first mobile
Modi TELSTRA was the first service provider in India
First city to receive mobile network: KOLKATA
Total number of Smartphones: ~30 Mn.
Smartphone share as a % of total mobile sales:
Leading smartphone operating system: Android
Share of android : 56.4%
Leading local brands : Micromax, Karbonn, Spice
Share of local brands in total smart phone sales:
Major players in the Market
Mobile phones in the market
Total mobile revenue – 1.5 trillion, over 2% of global
42% of the revenue from Top 10 operators
Samsung and Apple account for close to 50% of
smart phone unit share
And they also account for 90% of smartphone
Competition is Cut throat.
Latest smart phones
Apple : Apple iPhone 5
Samsung: Samsung galaxy s4
Micromax: Micromax canvas 4
Sony: Sony Xperia Z
HTC: HTC Butterfly, HTC one
Nokia: Nokia Lumia 1020
Blackberry: Blackberry Z10, Q10
Segments in the market
A. Ultra low cost mobile handsets (INR 3000-7000)
B. Medium cost mobile handsets (INR 7000-20000)
C. High cost mobile handsets (INR 20000+)
Segments in the market
The below table gives details of number of phones of
each brand in each segment
Market share of OEMs in India
Smart phone market share in India
The demand for a smart phone follows the normal
demand curve. As the price decreases, the demand
for the good increases.
Demand & Market Demand
As there are many factors that influence demand, we
assumed the demand equation to:
Q= 5P + 1C + 1.5F+2S+3B+4Ad+7U+2(DoI) + 1.5Se
For the price above 20000, some of the above said
factors do not matter. Hence,
Q= 2P + 1C + 2F+5B+6Ad+ 1 Se [for P>20000]
Elasticity, Inelasticity and Cross elasticity
A smart phone follows all the rules of normal
commodities excepting for a few exceptions. A normal
smartphone has price elasticity which is above unity.
Eg: demand for phones like Samsung S4, HTC one etc.
Exceptions being iPhone 5. Even though priced
extremely high, the demand of the iPhone 5 was so
high, that they fell short of supply as soon as the phone
was released. Being a luxury commodity, it is a fairly
Due to the high number of complementary goods, this
concept can be seen often
Acquisition of Motorola by Google
Merger with LG and Google
Acquiring Android finally name changed to Google play
Apple releasing their locked phones exclusively with network
providers like Airtel in India.
Same was done by Blackberry and Vodafone.
The decline of Nokia from being the top brand. This explains
the concept of cross elasticity among substitutes.
A Smart phone industry: An Oligopoly
Being an Oligopoly, fight for more market share is
always present. Some examples are
Micromax Canvas: strikingly similar to Galaxy S2, S3
Note 2 phones from Samsung, but almost at half the
Aggressive marketing by every player including Apple.
Blackberry, a brand known for QWERTY. Releasing a full
touchscreen phone with Z10
The famous case of Apple v/s Samsung