Will Apple, BlackBerry, and Nokia Thrive In India?

Will Apple, BlackBerry, and Nokia Thrive In India?

India is fast becoming a key territory for handset makers. Smartphones sales in the country have grown from 16.2 million units in 2012 to 44 million units in 2013 -- an exponential 171% year-over-year increase.

By 2017, IDC estimates that the industry will grow by a whopping 460%. Let's see what Apple , BlackBerry , and Nokia are doing to capture this expected growth.

Deep discounts
BlackBerry was once the leading smartphone vendor in the country. But high price points for its OS10 devices and the lack of hardware updates compelled budget-conscious Indian consumers to switch to other brands. Consequently, BlackBerry India's market share plunged from 14.8% in 2010 to a paltry 0.6% in the quarter that ended in September 2013.

BlackBerry, however, is looking to turn things around. Marking its 10-year anniversary in India, the Canadian smartphone giant slashed its Z10 prices by 60% last month for a limited period of time. The offer received an overwhelming response. BlackBerry, which was once struggling with unsold inventory, quickly ran out of Z10 stock in India.

Last week, BlackBerry's director of distribution announced that Z10 stock has been replenished across all major retail outlets, including online retail stores. And to recreate the magic, the smartphone vendor also cut its flagship Z30 price tag by about 13%.

The positive response from Indian consumers suggests that there is a robust demand for BlackBerry smartphones in this country, but the absence of practical price points was hampering its growth. But with its discounted pricing, BlackBerry may well become a formidable competitor in the booming Indian smartphone industry.

Increasing affordability
Apple is trying to lure value-driven consumers as well. The Cupertino-based consumer tech giant has launched a buyback program that allows people to exchange their working smartphone models for a minimum $85 discount on new iPhone 5s, 5c, and 4s handsets. Plus, its financing scheme on all three devices increases their affordability.

Apple India also relaunched its iPhone 4 earlier this year -- available for $300. Market tracker CMR notes that smartphones within a price band of $250-$330 represent 8% of total smartphone sales in the country. This suggests that Apple's entry in the mid-range smartphone will be crucial for it to sell more phones in the country.

Apple introduced the country's first-ever smartphone trial offer last week. As per the terms, consumers can return their iPhones within 14 days of purchase if they are not satisfied with the product. Apple will then refund the entire amount after deducting a nominal restocking fee of $15.

It's evident that Apple is trying to boost its value-for-money factor. But it remains to be seen whether consumers will prefer a premium, but outdated, iPhone 4 to the similarly priced, latest offerings from HTC, Samsung, and BlackBerry; Canalys estimates that Apple has about a 2% share of the Indian smartphone market.

Portfolio expansion
Nokia, on the other hand, has been busy with its portfolio expansion. The Finnish giant has launched five new Lumia devices this year; Nokia currently offers 11 Lumia models within a diverse price band of $140-$770. The company will reportedly unveil two new Lumia devices in April.

In addition, its Asha range consists 10 Java-based devices within a price band of $60-$120, while its latest Android-based Nokia X is priced at about $130.

Evidently, Nokia is trying to reach a broad spectrum of budget-conscious smartphone users. It is perhaps the only mature global smartphone manufacturer to mass-produce Windows, Android, and Java-based devices. With a country as diverse as India -- population 1.23 billion -- Nokia's product strategy might help to expand its market share, which is currently 5%.

Final thoughts
Investors should note that none of the mentioned smartphone vendors generate sizable revenue from their Indian divisions. So, investors should welcome their growth in India with a long-term view, rather than expecting any dramatic short-term gains.

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The article Will Apple, BlackBerry, and Nokia Thrive In India? originally appeared on Fool.com.

Piyush Arora has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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