Chipmakers say helping Indian handset brands to make a comeback

Chipmakers MediaTek and Qualcomm are working closely with Indian handset makers to help them make a comeback in the market where they have lost a significant share to Chinese brands such as Xiaomi, Oppo and Vivo.

“There has been some correction for sure in the market. Some will come back, and they are already working in this direction, and we are closely working with them,” MediaTek India's country head for corporate sales international, Kuldeep Malik, told ET.

Malik said local players would have a chance in India, given they have the right direction and mindset to grow. “There are challenges, but it's not impossible,” he added.


Qualcomm, meanwhile, is learnt to be collaborating with domestic brands to help them in the highly competitive smartphone market, which returned to double digit growth (18%) year-on-year in the second quarter of 2018 after a flat first quarter growth. The smartphone segment contributed to half of the total handset market during Q2 2018.

“You're going to see us continue to enable local brands to make them successful in their smartphone business," Jim Cathey, senior vice president for APAC & India at Qualcomm International, told ET in a recent interaction. He said Qualcomm was also working with some international brands in their entry into India.
Malik said Indian vendors should look at having a control over the complete value chain, which includes software, hardware and design, and work on expanding their market globally.

Indian handset vendors underestimated Chinese companies, and lost considerable market share to players like Xiaomi, Oppo and vivo in the last few years due to lack of focus on R&D and offline and online marketing.

According to analysts, India handset brands should look at certain market gaps than focusing on the entire market, which is becoming crowded. Indian brands must look at playing on distribution considering they have a good brand pull in smaller towns and villages.

In the last one year, local handset makers like Lava have cut down their portfolio and diverted focus on its USPs and design language, while Micromax and Intex have started to focus on the consumer durable market to offset losses.

Chinese brands accounted for 62% of the total Indian smartphone market in the Second quarter of 2018, up from 55% a year earlier. This was the highest ever share the Chinese players held in the Indian smartphone market, per Counterpoint Research.

MediaTek’s general manager of wireless communication, TL Lee, said the company is also working closely with Google to specifically target the ultra-low-cost smartphone segment. “We have an entry-level platform through which we want to help feature phone users migrate to smartphone,” he added.

Lee said intense competition was driving handset vendors to bring mid-range or high-range capabilities to the affordable segment at a time when first-time smartphone users are switching to relatively better phones seeking an improved experience.

“The market is intense currently, and the competition is to provide good user experience in various price segments, including low-end,” he added.