PROJECT REPORT ON MOBILE HANdSET INDUSTRY IN INDIA

SUBMITTED TO:SUBMITTED BY:Mr. ABU BASHAR ABHIJEET RAJ

MBA (II SEM) 2014-2016

COMPARATIVE ANALYSIS OF NATIONAL V/S INTERNATIONAL BRANDS : A CASE OF MOBILE HANDSETS IN DELHI & NCR

INTRODUCTION : The first mobile handset production made by Motorola.The first mobile phone was launched in India on 31 July 1995. West Bengal Chief Minister made India's first cellular phone call, inaugurating Modi Telstra's MobileNet service in Kolkata. The company is a joint venture between India's Modi Group and Australian telecom giant Telstra. Delays were made for various reasons, including last-minute haggling between the companies and India's Department of Telecommunications and problems with allocating frequencies (many of which the Army using them for its own communications - is reluctant to give up). The providers started advertising only around April, and most, included those in Bombay and Delhi, said they would start services later that month, assuming they finish installing their equipment.

 In early 2008, there were only 6 to 8 brands operating in the Indian mobile devices market, and almost all of them were global. This number increased to over 180 by 2011. Young Indian handset vendors such as Micromax, Karbonn, Spice, Lava, Maxx, Olive, etc primarily account for this increase. Some of these Indian brands have had an excellent run in 2009 & 2010, with Micromax selling more than a million devices a month and almost displacing Samsung as the No. 2 player by mid-2010.The success of Indian OEMs can be attributed to multiple factors: Many Indian handset brands were started by former national and regional distributors of global OEMs (such as Nokia, Motorola, Samsung, etc). These companies partnered with Mediatek (MTK), a fabless System-on-Chip (SoC) provider and ODMs based in Taiwan and China to source white-labeled devices (with basic Indian market hygiene requirements like long battery life and high audibility) These companies leveraging their strong distribution experience have incentivized the distribution channel with high margins and primarily selling white-labeled devices, were also

able to garner high operating margins (in excess of 35%) Their strategy of offering feature phones at competitive prices, initially to rural and suburban markets and being the secondary devices to urban consumers helped them gain a foothold in the market. The launch of multiple-SIM devices by Indian OEMs when none of the global OEMs had such devices in their product portfolio, coupled with the launch of new carriers offering low tariffs helped increase the demand for these devices, as consumers started owning multiple SIM cards. During their peak (in 2009-10) multiple SIM handsets formed over 28% of all the devices sold in India monthly Some of these companies such as Micromax, Lava, Karbonn, Spice and Olive have also managed to build nation-wide brands by 2010 The Chinese handset market has undergone a similar influx of local vendors in partnership with MTK in 2007. Tianyu(market facing brand of Chinese telecom player K-Touch) was the first Chinese vendor to launch mobile handsets based on MTKs turnkey solution in early 2007. Tianyus key

success factors include products with feature set that address local market needs, faster turn-around time, wide spread distribution and high channel margins to distributors. By end of 2008, a number of local vendors such as Bird, Amoi, ChangHong, Gionee, etc had entered the Chinese market using Tianyus business model. Increased competition among numerous vendors resulted in ASP (Average Selling Price) reduction, in turn affecting handset margins adversely. By second half of 2011, the competition among Indian handset brands increased similar to the Chinese market (of late 2008/early 2009). Price wars (without any product differentiations) have significantly reduced sales and revenues of these players and the operating margins started to decline (and hover around mid-teen percentage points) under pressure. Poor quality issues (in some cases) and brand fatigue had resulted in channel and consumer retaliation. With business growth stagnating in Indian market, a number of these vendors have started exporting their products into other emerging markets. While Spice focused on their I2I (Indonesia to Ivory Coast) strategy, Micromax entered the Middle-East,

Africa and Latin American markets and Olive focused on Baltic countries. However, going forward, to remain relevant and competitive, the Indian handset OEMs need to metamorphose from mere marketing and distribution houses into full-fledged product companies. The global smartphone revolution is slowly but surely catching up in emerging markets, especially India. While smartphones formed around 7% of total mobile devices sold in India in 2011, they increased to around 12% to 15% in 2012. The launch of 3G services in India in late 2010/early 2011 and the proliferation of smartphones in 2011 raised consumer awareness and aspirational levels. And, the high ASP smartphones also provide higher margins as compared to featurephones (with waferthin margins). Although, few Indian brands such as Micromax and Spice launched Android-based smartphones in 2011, they were not able to replicate their featurephone success. To grow on the value chain and become successful smartphone (and hence, portfolio) players, companies need to invest heavily in R&D and Product Marketing teams. Companies need expertise in building products with the right hardware, software, operating systems, applications

& content and build the ability to position them appropriately to the consumer. This will be a longdrawn process, but the players who will manage this transition successfully will emerge as winners in the long-term.

Some of the major players in mobile handset industry in India:1 | Samsung

Corporate office Suwon, South Korea | Establishment 1977 | Business Electronics Products | Website www.samsung.com | A South Korean company Samsung telecommunications was established in the year 1977 with its headquarters at Suwon, South Korea. It is one of the best telecommunications companies which manufactures mobiles and other mobile devices such as laptop computers, MP3 players, telecommunication network infrastructure etc.

2 | Nokia
Corporate office Espoo, Finland | Establishment 1865 | Business Mobile | Website www.nokia.com | Worlds largest manufacturer of mobile phones Nokia is headquartered in Espoo, Finland. It is one among the top mobile companies in india, which has been a dominating the Indian market for past 10 years. It has software collabration with giant microsoft and microsoft may take over Nokias global business very soon.

3 | Micromax
Corporate office Gurgaon, Haryana | Establishment 1999 | Business Mobile, Television and electronics products | Website www.micromaxinfo.com | Micromax one of the top 10 mobile companies in India is ranked twelfth largets handset manufacturer in the world. An Indian brand recognized globally for its innovative products at affordable prices. Companys product range includes QWERTY to dual-SIM phones, touch-enabled smart phones and 3G Android Smartphones.

4 | Karbon
Corporate office Bangalore, Noida | Establishment 2009 | Business Mobile and electronics products| Website www.karbonnmobiles.com | Karbonn among the top 0 mobile compaies in India is one of the leading mobile brands in the country. Established in the year 2009 its a joint venture between Bangalore-based UTL Group and Jaina Group.

5 | Sony
Corporate office Tokyo, Japan | Establishment 2001 | Business Electronics products | Website www.sonymobile.com | Subsidiary of Tokyo-based Sony Corporation Sony Mobile is a leading mobile manufacturing company established in the year 2001. Its innovative product range consistes of game, communications, audio, smartphone and tablet etc

6 | Blackberry
Corporate office Waterloo, ON, Canada | Establishment 1984 |

Business Telecommunications | Website in.blackberry.com | A Canadian telecommunication company released their first device in 1999 and is the sixth most popular mobile device maker in the world.A Blackberry can perform many complex functions such as video shooting, photos, music as well as web browsing and emailing and also supports variety of instant messaging features.

7 | HTC
Corporate office New Taipei City, Taiwan | Establishment 1997 | Business Telecommunications | Website www.htc.com/in | A leading telecommunications company manufacturing electronic devices such as touchscreen phones, mobiles, PDAs having based on Windows Mobile OS and Android. It is a Taiwanese company founded in the year 1997 and leading mobile company in India in smart phone category

8 | LG
Corporate office Yeouido-dong, Seoul, South Korea | Establishment 1958 |

Business Telecommunications | Website www.lg.com/in | A Korean company having expertise in five sectors Home Entertainment, Air Conditioning, Home Appliances, Energy Solutions and Mobiles. It is among the best mobile company in India and worlds fifth largest mobile phone manufacture. It was established in 1958 at Seoul, South korea.

9 | Apple
Corporate office Cupertino, CA, United States of America | Establishment 1976 | Business Telecommunications |Website www.apple.com/in | Apple is a US company which was founded in the year 1976 with its headquarters at Cupertino, California. It is one of the top 10 mobile companies in India and worlds second largest electronics company. Company achieved recognition after their innovative iPad, iPhone products. They develop and design computer s/w,personal computers and consumer electronics.

10 | Spice
Corporate office Mohali, India | Establishment 1997 |

Business Telecommunication | Website www.spiceglobal.com | Spice is a leading Indian mobile brand which was established in year 1997. It is premier brand in semi smart phone category and hold around 2 percent market share in overall mobile business in India. However some more Indian brands also exists which in the market which have not been able to influence the market as much as these companies have done.

Some major Indian mobile handset company:Micromax The Huge Indian Mobile Brand

Micromax is the premier mobile manufacturing company that takes the lead in manufacturing LED TVs and mobile phones. Micromax mobiles are selling good in the foreign markets like Dubai, USA and Hong Kong. The mobile phones are Value for your money, Durable, IPS LCD capacitive touchscreen capabilities, Integrated with Android Facilities and Low Cost.

Karbonn Mobiles The Dual SIM Android Phones

Karbonn Mobile is a leading Indian brand, which is a successful and joint venture between the united telelinks limited and jaina marketing & Associates respectively. Karbonn Mobiles are Durable, Distinctive in Design & Loaded with Dual SIM Android Arrangement.

Spice Mobiles Impressive Mobile Phone Brand

Spice or the Cellebrum Technology is a popular mobile brand that has introduced Android Smart Phone Devices as well as the Tablets. Its exclusive Stellar mobile phone series has the dual SIM phone capabilities and several other features. The Spice Mobiles are Unique in Design, Affordable & Easy to Manage.

Iball Mobiles Cool Mobile Phone Brand

iBallstarted with the manufacturing of superb quality mouse and ventured in the Indian Mobile Market. The Indian mobile brand offers great after sales service. The iBall mobile phones are Affordable are best.

Intex Mobiles Powerful Indian Mobile Phone Brand

The mobiles from Intex are exclusive and have come up with exclusive range of mobile phones that have given new definition to the communication. The Intex Mobile phones are Affordable and completely within the budget, Backed by Powerful Processors and Good Quality Battery.

Videocon Great Indian Mobile Phone Brand

Mobile Phones which are affordable Have Android Capabilities Practical G Sensor Loaded

LAVA Mobiles Attractive Mobile Phones

The mobile phones have shown

Stable Track record Variety of Choices Available Plenty of Features and Functionalities

Celkon Mobiles Good Communication Features

The Celkon Mobiles show:

Social Media Integration

Dual SIM Arrangement 3 Megapixel

ZEN Mobiles The Super and Smart Mobile Phones

ZEN Mobiles are known for good and reliable communications. ZEN is the mobile phones are

Great Mobile hones Mobile Phones run on Android Touchscreen Mobile Phones

MVL Mobiles Business & Non Business Mobiles

The mobile phones from MVL are:

Packed with Wi-Fi Connectivity Offers Easy Communication Flash Memory

Tough competition is being given by the national mobile handset companies to the international brands. Survey for the year 2013 depicts it very well.

Major issues in Mobile Handset industry: Despite of excellent service & product quality, the domestic mobile handset companies are unable to capture a large market share. The MNCs of mobile handset companies are charging more money from the customers in the

name of BRAND but providing similar product that is being offered by domestic companies.

OBJECTIVE: To study the reasons behind the peoples mentality of not preferring the product of domestic mobile handset companies.

RESEARCH METHODOLOGY
Type of study:- Causal Sampling Design:- Simple Random Sampling Technique. Sample size:-50 Type Of Data:- Primary Data Collection Instruments:Questionnaire & Personal Interview Data Analysis Tools:-