It’s Still Early for Smartphones in India

Xiaomi Is Now Open for Business. Good Timing.


Smartphone growth is decelerating fast in many markets, but sales in India are just getting hot. What makes this particularly exciting is that smartphones will be the first ever gateway to the Internet for many Indian households. The devices will enable mobile banking in a country which is notoriously under-banked, and will act as e-commerce hubs in a market being eyed by major global and ambitious local online retailers.

We estimate that there are currently about 180 million smartphone users in India, a country with a population of almost 1.3 billion people. CCS Insight believes the number of users here will double by the end of 2016, as the average selling prices of smartphones continue to decline and operators and other service providers adjust for this surge in smartphone users.

Chinese consumer electronics company Xiaomi has just launched its Indian Web site as the company plans to establish itself in India during this growth. No sales are currently possible on the Indian site and no products are listed, but we believe that Xiaomi has an existing portfolio of Android-based devices that will be well received by Indian consumers. These handsets include the popular dual-SIM Redmi (priced at about $140) and the Mi 3, a higher-end smartphone that is selling out in minutes in some markets (priced at about $240).

Xiaomi has made no secrets about its assertive global expansion plans as it enters markets across Asia and Latin America. The company has wisely chosen to rebrand itself as part of its ambitions by emphasising its Mi brand. The decision may seem minor, but adjusting its brand for non-Chinese speakers is a clear sign that Xiaomi is intent on becoming a global player and is willing to be flexible as it works its way up the market share rankings.

Xiaomi estimates that it will sell 60 million smartphones during 2014, a number that could make it a top-five global smartphone manufacturer. This would be an impressive feat but is likely to be dependent on its success in India, where popular local competitors including Micromax and Karbonn and a global brands such as Samsung are holding tight. Nonetheless, for all smartphone players, this is a good time to get to know Mi.

Click here for more information on Xiaomi’s successes in China.