India Tops Asian Smartphones Market In Q1 2014

India was the highest growing market in Asia Pacific with a year-on-year smartphone shipment growth of over 186% in 1Q 2014.The vast majority of the country's user base migrated to smartphones from feature phones and as a result Indian smartphone market outshone other emerging markets like China which registered a year-on-year growth of 31% in 1Q 2014.

The smartphone penetration in India still hovers at 10% and it is expected to grow due to a variety of factors including greater availability of low-cost devices and additional sales emphasis by top-flight vendors on less populous parts of the country.

According to the International Data Corporation (IDC), the overall India mobile phone market stood at close to 61.07 million units in 1Q 2014 which is a 10% quarter-on-quarter dip and a mere 1% year-on-year growth. The dip in the overall mobile phone market shipments can be attributed to the 18% decline in the feature phone shipments from 4Q 2013 to 1Q 2014. This was offset by the smartphone market, where units shipped grew by close to 17% in 1Q 2014 compared to 4Q 2013. The consistent growth in the smartphone market is driven by enhanced consumer preference for smart devices and narrowing price differences.

The share of feature phones in the overall market further slipped further to 71% in 1Q 2014 which is a considerable decrease from 90% share in 1Q 2013.

The India smartphone market grew by a whopping 186% year-on-year in 1Q 2014. According to IDC Asia Pacific Quarterly Mobile Phone Tracker (excluding Japan), vendors shipped a total of 17.59 million smartphones in 1Q 2014 compared to 6.14 million units in the same period of 2013. The shipment contribution of "phablets" (which IDC defines as 5.5 inch-6.99 inch screen size smartphones) in 1Q 2014 was noted to be around 5% of the overall market. The category grew by 125% in 1Q 2014 in terms of sheer volume over 4Q 2013. The primary reason behind this trend is the launch of low-end phablets by international and local vendors alike.

The sub-200 USD category in smartphones contributed to about 78% hinting at the fact that the growth in the India Smartphone market still remains constrained towards the low-end of the spectrum.

  "As more vendors continue to launch low priced smartphone models, the price gap between feature phones and smartphones will be narrowed, driving rampant user migration in the price sensitive Indian market," says Manasi Yadav, Senior Market Analyst at IDC India.

"This rapid pace of growth in smartphones is expected to continue in India. While we notice that much of the growth is coming from low-cost devices using the Android operating system, Windows is making adequate gains too based on the strength of the entry level product mix in smartphones," comments Kiran Kumar, Research Manager- Client Devices at IDC India.

Top Five Smartphone Vendor Highlights

* Samsung maintained its leadership in the smartphone market with 35% market share in 1Q 2014. High volumes came in from the low-end devices like S7262 Galaxy Star Pro Dual SIM and Galaxy S Duos 2 S7582.

* Micromax held onto its 2nd position with approximately 15% market share. The top selling models for Micromax came in from the low-end Bolt Series.

* Karbonn was 3rd position with approximately 10% market share. Its low-end range of 2G smartphones did well in 1Q 2014.

* LAVA climbed up to the 4th position with close to 6% market share. New XOLO launches like A500S and A500 have fared well.

* Nokia made its way back to the top 5 list with about 4% market share. The Nokia X launch coupled with other low-end Lumia phones helped in improving the overall performance of the brand.

IDC India Forecasts:

IDC anticipates that the migration from feature phones to smartphones will increase as cheaper variants of smartphones are launched in the market. Growth in the smartphone segment is expected to outshine the overall handset market growth in the foreseeable future. According to the 1Q 2014 lDC forecast, the India smartphone shipments will reach 80.57 million units by the end of CY 2014. IDC expects that the Indian smartphone market will grow at a CAGR of about 40% for the next 5 years.