Indian tablet market doubles in 3 months; Samsung retakes lead, Apple slips

Sales of tablets doubled in the July-September quarter in India, compared to the previous three months, as shipments of Samsung’s tablets almost quadrupled, research firm CyberMedia Research (CMR) said in its quarterly report.

According to CyberMedia Research estimates, total shipments for the India Tablet PC market are expected to close at 3 million units in 2012.

Further, the market is expected to increase by at least 100% in 2013 (double the number of units sold in 2012). In case large deals are announced by vendors for supplies to governments for distribution to university, college and high school students, the forecast number of Tablet sales for 2013 could easily exceed 6 million units, CMR said.

With shipments of nearly 263,000 units, Samsung regained the top spot in the Indian tablet market with a 23.9% share, rising fast from a 13.3% share in the previous quarter.

In the previous quarter, Samsung had been beaten to the top spot by Micromax.

While Samsung’s share increased, that of Micromax fell from 18.4% in the second quarter to 15.3% in the third one. Apple slipped further, vacating the third spot in favor of low-cost tablet maker Datawind, which makes the Akash tablet.

Apple’s market share slipped during the third quarter compared to that of the second quarter, perhaps owing to the extremely fast pace of overall market growth. Except Samsung and Datawind, none of the others were able to keep up with the frenetic pace of growth.

The world’s top tablet maker came third with a 12.3% share in India during the second quarter. But in the third quarter, Datawind came in the third place with a 12.3% share (see chart above.)

“I expect this to be the last quarter that will show the kind of ‘stereotype’ ranking results typical to the India market. During 4Q 2012 and through 2013, we expect to see a change in the rankings, with global leaders like Apple and Google coming into their own, especially after the launch of the Apple Mini and Google Nexus range of Media Tablets, respectively.” said Tarun Pathak, analyst with CMR Telecoms Practice.

He pointed out that Samsung is now offering relatively cheaper models (such as the Tab 2 series, which are priced in the Rs 18,000 range, compared to the average sales value of Rs 13,000). This will increase the share of international brands in India in the coming months.

“These new devices closely match the Media Tablets already available from other leading OEMs in India, in terms of specifications and price levels. This is particularly true of Samsung. So it will be interesting to watch if potential buyers of Tablet PCs go for other MNC brands or whether Samsung is able to retain their loyalty,” Tarun said.

Thanks to the burgeoning demand, overall tablet sales doubled in the September quarter to 1.1 million (11 lakh) units from 0.55 million (5.5 lakh) units in the June quarter.

The average selling price remained more or less flat at Rs 13,200. 63.5% of all sales were below the INR 10,000-mark.

“A majority of the Tablets currently on offer have built-in Wi-Fi connectivity with 3G access enabled through a USB dongle. However, going forward, increased penetration of 3G networks, declining ASVs of 3G-enabled Media Tablets and launch of BWA (4G / WiMax / LTE) services in the country is likely to see a rise in 3G-only Tablet devices with larger screen sizes. This trend is expected to give a fillip to new types of data services and content being demanded and consumed by subscribers, which in turn will drive a further increase in adoption of Media Tablets in India,” said Faisal Kawoosa, Lead Analyst, CMR Telecoms Practice at CMR.

CMR also expects increasing adoption of Windows 8 in the coming months.

“Windows 8 based Media Tablets will be the main highlight in the market. In 2013, India will witness Tablet PCs being made available on Windows 8 from all leading brands,” it predicted.

As a result, enterprises will see increasing adoption of Tablet PCs as part of the larger trend towards mobility, it added.

“So far enterprises have been trying to understand the role of Tablets in the enterprise space. Through 2012, at different forums industry leaders were seen deliberating upon several industry vertical-focused use cases of Tablets and these are expected to be implemented in 2013. With BYOD an increasing reality, this implementation will very likely to gain an impetus across verticals,” CMR said.

Another feature will be LTE, which is going to be rolled out in India in the coming months. “At least a few OEMs are expected to announce LTE / LTE-ready Tablets for the India market in 2013. Though we haven’t seen many Tablets announced yet supporting LTE worldwide, but India, rightly poised at the juncture of an LTE ‘big bang’ can be an attractive destination for players who can meet the expectations of Indian customers across segments. Tablets are expected to gain traction as the preferred device for first time computing enthusiasts and for those seeking high data consumption applications over LTE networks,” CMR predicted.

It also predicted that the sub-5000 rupee category is likely to thin out and vanish.

“2013 is likely to see some of the players in this segment closing shop due to lack of market acceptability and increasing expectations of consumers, where these devices are bound to fail.”

2013 will see markets crystallise around three price points for the India Tablet PC market. These will be INR 5,000-10,000; INR 15,000-20,000 and over INR 35,000, CMR predicted.

“Some vendors might have to undertake price corrections to fit their devices within these three price segments, to serve the market aptly and participate in these high-volume price levels.”

The key drivers for the growth are seen as the large number of launches by OEMs eyeing the India consumer market for mobile computing and data communication products, as well as the demand expected to be generated via enterprise adoption of Tablets.

Said Faisal Kawoosa, Lead Analyst, CMR Telecoms Practice commenting on the outlook of Media Tablets for 2013, “To my mind two key developments are going to change the India Media Tablets market significantly – one is the availability of Windows 8 based devices and the adoption of Tablets by enterprises for serious and real business applications.”

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