BlackBerry Faces Tough Competition In India

By: Talha Bhatti  |   March 13th, 2013   |   Business, News, O Canada, Smartphones

Canada’s struggling smartphone maker, BlackBerry, has set its eyes on the fast growing consumer base in India as a way to grab a larger piece of the global market share. BlackBerry 10 and related devices are being used by the firm as tools for securing developing markets where the company has traditionally done well. However many changes taking place on the ground in India are endangering BlackBerry’s plans. Stats show that BlackBerry devices can amount to 60 percent of smartphone sales in some developing countries. The large share comes from the Canadian firms technology being able to run well on lower end wireless networks. Another factor is that Apple stores do not have a large presence in many emerging markets and cannot offer their devices directly for sale. Africa, Latin America and Asia including India are now moving to smartphones and make up 65 percent of BlackBerry’s sales.

 

The Canadian company launched its new all-touch BlackBerry Z10 in India last month. The company hoped to be able to capture a large part of the market with its device but this did not happen and it is trend that may follow the company in other markets. According to research firm IDC, BlackBerry smartphone shipments to India dropped to 5.9 per cent in 2012. This is a major drop from the 12.8 per cent in 2010. In comparison, South Korea’s Samsung went from 4.9 per cent of shipments to India in 2010 to a whopping 42.5 percent by 2012.

 

India is a attractive market with an estimated 900 million mobile subscribers with only 5 percent using smartphones. BlackBerry is still finding it self in an awkward position in the country. The BlackBerry Z10 is meant to be a high end device that should compete against Apple and Samsung. However it does not have the same popularly as the iPhone or Galaxy devices. It is also too expensive to compete against the lower devices on the market.

 
Amit Goel, a technology consultant for Knowledgefaber, says that, “If you have money, you’ll go for iPhone. If you’re a geek who doesn’t like Apple, you’ll go for Samsung, and the remaining people who want a smartphone are going for local manufacturers like Micromax, where you can get almost all the specs of the Z10 for R14,000 [14,000 rupees, about $260].”

 
BlackBerry’s managing director in India, Sunil Dutt, expressed different thoughts in an interview where he said, “A whole lot of Indian retail customers are ones who see BlackBerry users as being very successful in life, looked-up to, people to emulate. We don’t have to do any rebuilding – it didn’t reach the stage where people thought it was uncool to have a BlackBerry.” Interestingly, Mr Dutt ended up leaving the firm after a few days of the launch of the new BB10 device.
BlackBerry’s high price has also been seen as a major factor for its competitiveness in India dropping. The lower end has also been hard because local manufacturers like Micromax have grabbed market share. BlackBerry has done well in other developing markets like Indonesia and Nigeria where it has a 50 percent market share but things are also changing there. Chetan Sharma, a wireless consultant in the US says that, “Each market is unique, but in price-sensitive markets, you will see similar dynamics.”

 

Kevin Restivo, a IDC mobile analyst, says “BlackBerry has more runway in India than it does in many other countries as 3G networks are in their infancy and the vast majority of Indians are still feature phone users.” He adds that BlackBerry’s  “global issues, namely brand equity, app development momentum and overall competition against Samsung and other tech titans, still factor prominently as it tries to grow in India.”

Source: The Globe And Mail