BlackBerry users in non-metros opt for higher versions

MUMBAI: Customers in non-metros such as Pune and Ahmedabad who had initially experimented with Research in Motion's BlackBerry smartphones, are increasingly going in for a higher version of these handsets when buying their second cellphones, the company's managing director for India, Frenny Bawa said.


RIM is excited about the opportunity in the handset replacement market, and the company will also tinker with price points to keep customers in India interested in BlackBerry products, she added. The uptake of smartphones, or phones with features like web browsing and e-mail, is increasing dramatically in India with the hope of launch of third generation mobile services that delivers high-speed connectivity to the mobile phone.

The growth is expected to be significantly high in tier II markets where wired access to the Internet is limited. "I am acutely aware of the price elasticity in the Indian market and the inflexion point for growth," Ms Bawa said, when asked if prices of BlackBerry phones are likely to be reduced in the near future.


The company's aim will be to reduce the price spread between phones, so buyers can get more features for slightly stretched budgets, she said; a win-win situation for the buyer, who sees more value in the better handset, and the company that gets more revenue for the sale. RIM is engaged in talks with the Indian government over security of the messenger and e-mail encryption services it offers. Ms Bawa said, "We are a global company with standard practices around the world. From my perspective any of these issues are part of the course. We will discuss with the government constructively and sort it out, because we are committed about doing business here."


The smart phone market is expected to more than double over the next year. A recent report by the Boston Consulting Group said the average price of a smart phone drop to less than Rs 4,500 by 2015, from more than Rs 11,000 today. The Blackberry range starts at around Rs 12,000-13,000. In smaller cities, people are not familiar with Blackberry phones and prefer to start with a basic model, Ms Bawa said. These users soon become more sophisticated and replace the phones with better models, she added. However, unlike bigger metros the upgrades are little at a time, meaning users don't skip technologies.


Blackberry will not neglect such a high-growth market, and will do what it takes to push growth, Ms Bawa said, without disclosing growth targets for India. "The India experience is unique for us. We are committed to the market and are not taking the market for granted; we are focussed on introducing more products, services and making them relevant to the Indian consumer."


She cites the example of the AppStore-a platform from which users can download software like web radio, book readers, online chatting. Blackberry had a large global store, but in India, it deferred its launch till it had applications that catered specifically to the Indian market, she said.