tablets market in india in 2013

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CHENNAI DELHI KOLKATA MUMBAI Sep 30-Oct 6, 2013 www.twitter.com/dqweek www.dqweek.com Follow us on www.facebook.com/TheDQWeek www.twitter.com/dqweek www.facebook.com/TheDQWeek Follow us on www.facebook.com/TheDQWeek www.twitter.com/dqweek www.facebook.com/TheDQWeek National Supplement - Tablets Tablet is the new PC ABHISHEK ANGAD New Delhi, September 25 T his year in May, Thorsten Heins, CEO of Blackberry, said in an interview to the Bloomberg that he doesn’t find any reason to have tablets existing in the next five years as it is 'not a good business model.' Are there even any proponents of this school of thought? Maybe, but not in India. Indian tablet PC mar- ket, contrary to Heins' belief, is adopted in professional workforce and also sees the likes of a consumer. Data reveals that there is a huge surge in the number of tablets sold, a 428% growth, according to a study by electronic hardware industry body MAIT (Manufactur- ers Association for IT). This segment grew from 0.36 mn units in the year 2011-12 to 1.9 mn units in 2012-13 and will continue to grow. Latest data by Cyber Media Research (CMR) on Indian Tablets PC market also states that around 1.15 mn units were shipped in the April-May-June quarter by around 70 domestic and international vendors. In the last few quarters, every quarter had over a million shipments of Tablets with only 1Q 2013 being an exception, says Faisal Kawoosa, Lead Analyst, CMR Telecoms Practice in a release. He stated, “Q2 2013 results have again shown that 1 mn units a quarter is a sustainable number, which is a healthy indicator about adoption of the form factor in India in less than three years. If this trend continues to build up, I see adoption picking up and just a few quar- ters from now we should see shipment of significantly higher volumes.” Why are Tablets so Hot? The reasons for growth of tablets may be attributed to the fact that various companies have prioritized on mobility of computing devices, where tablets are a perfect fit. Tablets generally come with low cost, easy connectivity, packed with exciting features as well as rich in computing experience. It is today seen as a device which is both entertaining and informative. Sales force automation is one prime area where tab- Continued on page 3 Tablets are selling like hot cakes. Interestingly many new vendors are jumping in the fray. What does the future hold?

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The DQ Week presents the special on Tablets market in India in 2013. It is a one stop information on the trends, market overview, vendor strategies and competitive analysis

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Chennai delhi KolKata MuMbai Sep 30-Oct 6, 2013

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National Supplement - Tablets

Tablet is the new PCabhisheK angad

New Delhi, September 25

This year in May, Thorsten Heins, CEO of Blackberry, said in an interview to the Bloomberg that he doesn’t find any reason to have tablets

existing in the next five years as it is 'not a good business model.'

Are there even any proponents of this school of thought? Maybe, but not in India. Indian tablet PC mar-ket, contrary to Heins' belief, is adopted in professional workforce and also sees the likes of a consumer.

Data reveals that there is a huge surge in the number of tablets sold, a 428% growth, according to a study by electronic hardware industry body MAIT (Manufactur-ers Association for IT). This segment grew from 0.36 mn units in the year 2011-12 to 1.9 mn units in 2012-13 and will continue to grow.

Latest data by Cyber Media Research (CMR) on Indian Tablets PC market also states that around 1.15 mn units were shipped in the April-May-June quarter by around 70 domestic and international vendors. In the last few quarters, every quarter had over a million shipments of Tablets with only 1Q 2013 being an exception, says Faisal Kawoosa, Lead Analyst, CMR Telecoms Practice in a release.

He stated, “Q2 2013 results have again shown that 1 mn units a quarter is a sustainable number, which is a healthy indicator about adoption of the form factor in India in less than three years. If this trend continues to build up, I see adoption picking up and just a few quar-ters from now we should see shipment of significantly higher volumes.”

Why are Tablets so Hot?The reasons for growth of tablets may be attributed

to the fact that various companies have prioritized on mobility of computing devices, where tablets are a perfect fit. Tablets generally come with low cost, easy connectivity, packed with exciting features as well as rich in computing experience. It is today seen as a device which is both entertaining and informative.

Sales force automation is one prime area where tab-

Continued on page 3

tablets are selling like hot cakes. interestingly many new vendors are jumping in the fray. What does the future hold?

Sentinel_AD_16cm x 25cm _DQ_Hi-Res.pdf 1 11-Sep-13 5:31:10 PM

www.dqweek.comSep 30-Oct 6, 2013The DQ Week2 ta b l e t s

v e n d o r c h a n n e l s t r a t e g i e sVineet taneja, Country head, Mobile and it, saMsung india

shashin deVsare, exeCutiVe direCtor, Karbonn Mobiles

saji KuMar, produCt ManageMent direCtor, aCer india suneet singh tuli, Ceo and president, dataWind

uneaz Quraishi, direCtor, sales and distribution, asus india

ViKas jain, Co-founder, MiCroMax inforMatiCs

With around 14% market share in the tablet segment, second largest

mobile maker Micromax intends to double the figure in next six months. If we go by approximate figures, consumers are using over million tablets currently, and this fig-ure will only double in the coming times.

Tablet market is on an all time high and it is here to stay. The segment has great potential and it will grow immensely. The new ‘phablet’ fever has conquered the consumer mind and the screen size of 5 to 11 inches is in great demand.

Regarding the go-to-market strategy about this segment, Micromax believes in ‘bringing in a great experience for the con-sumer’. We don’t focus on price or class, but we want our customers to evolve from experience. These days, consumers are using tablets mainly for streaming data and we are thus focusing on the same.

As per the channel is concerned, we don’t specifically go for It or telecom based channel partners. We believe that ‘what is seen is what is sold’, so we basically intend to increase the retail point. We want our product to be seen at most places. We want maximum exposure for it. And same chan-nel strategy goes for the tablets.

Cashing in on the current rage for the product, we recently come up with our 650 tab that is of 8 inches. We are constantly looking into and considering con-sumers’ needs and demands. We might soon come up with a new version of the product with 10 inches of screen.

The tablets year-to-date (YTD) sales have shown a growth of 433% in volumes and 261% in value, according to

GFK-a Germany based market research institute. In India, we expect to double our tablet sales by next year. The tablet is today seen as an infotainment device and is therefore rapidly gaining ground in India. It is showing good sales in the retail segment as individual consumers are going in given the easy connectivity, portability and the rich multimedia experience. Also, the tablets are showing good traction in the education and the enterprise sectors.

Our tablets keep our consumers connected with their work, family and friends while being on the move. As for Samsung, we have a 57.7% value market share in tablets, as of July 2013 and our product Note 510 and Tab 3 is seeing a good interest from large consumers, meeting both their creativity and consumption needs. We are looking at further strengthening our position in the market based on our dif-ferentiated product portfolio; our breadth of range and our strong reach in India. Regarding channel sales, I think the convergence between telecom and IT partners is going to stay. Retail is playing an important role in our tablet distri-bution; be it our smartphone cafes, large format retail or IT product outlets.

Regarding the phablets, there is a clear consumer prefer-ence for 5" and above smartphones, which today constitute anywhere between 15-20% of the industry's Smartphone sales. However, I don’t think tablets would replace laptops since both the segments are relatively still in the nascent stage.

Tablet is definitely going to be a key product port-folio because we have an incremental business in

India. Two years before I had a different opinion as tablet was considered a secondary device but today, people are willing to make it a primary one. There has been a significant development as far as market trends are concerned. Customer experience has become a key issue at the point of sale. I assume that gone are those days where a customer buys a product by look-ing at its configuration; if you talk to any consumer about the processor in their smartphone, they might not know.

I believe tablet market is around 300,000 units plus in a quarter. Acer is still a very nascent player. We have invested in building an engineer team; we have in-house R&D and very strong product road map. We are confident as we have a strong portfolio. Acer is primarily looking at tablets with 7 inch screen. Our strength lies in our brand value as we are already established in India from the last 14 years. We have choices to offer in both windows and android plat-form.

Consumer is definitely a key market, on the com-mercial space, automobile is one key area we are focusing on. Recently we have supplied 1000 tablets to an automobile dealer .We are training our sales team, our partners primarily for depth of engage-ment. We will leverage the strength of our channel partners.

In my opinion, the market in calendar 2013 will increase by about 30% over 2012 – i.e. to about 4 million to 4.5 million units. I think

to understand the accuracy of the results of the different analysts (dif-ferent research bodies mentioning different figures of tablets sales), one needs to review the depth of their reports and see if the level of analysis conducted accounts for the various different brands and models in the market – and how the information has been gathered and verified. To date, we have only seen the CMR reports consistently analyze the market with painstaking detail.

However, India has two key differentiators over most other developing markets; first is that awareness generated by the government’s efforts around the Aakash tablet has created broader interest in the segment than most other markets and second: India is one of the most aggressively priced market, where consumers take tablets as their first computer.

Our market share ranges between15% to 20% and I believe that affordability of devices and internet accessibility are the key growth drivers. Most of our competitions are simply private-labels of Chinese products while our products are based on fundamental research and development efforts. Our technology is covered by 18 U.S. and inter-national patents for delivery of a faster and richer web experience on mobile networks.

Our strategy to date has been direct-to-consumer; however, we are now establishing our channel ecosystem. We have started establishing relation-ships with key e-commerce partners and a retail roll-out. Our retail efforts have started in Rajasthan where we have established and trained 130 retail partners so-far, and expect to expand this base to 1,500 nationally, by end of year. In addition to healthy channel margins, we support the channel with content, apps and accessories to help customize the solution to the customer’s needs.

Indian market is a diverse one and each region has its own set of trends and preferences. What favors a par-

ticular section of the market may not be an option for the other. In this wide market we understand that products that offer a good value for the price are accepted by the customers at large. So we are aiming at incredible product, quality, design and service.

In India, you need a different strategy from the global markets. So we are aiming at offerings with a product line that excels in security, responsiveness and other exciting features as well as rich in computing experience. We do not compromise on the quality of our tablets, though we offer our product at different price levels.

We have been working on strengthening our distribu-tion channel and have recently appointed new partners. We are focusing on escalating regional level distributors to help us to ensure that our products reach tier-II and tier-III cities, apart from the tier-I cities. Asus is working towards an all round focus and hence help our partners to develop a profitable and sustainable business. Every quarter, we organize training programs—both on prod-ucts and technology—for our partners and also reward them with training, certification, specialization as well as competitive margins.

This helps them in having better understanding of our offerings. Some of our products that have generated a lot of interest amongst buyers are: the ASUS Nexus 7, a seven-inch tablet with NVIDIA processor and ASUS Transformer Pad TF300TG, a quadcore CPU tablet, which has up to 30% higher graphics performance for better gaming experience.

403-A, Sant Nagar, East of Kailash, New Delhi-110065Ph. : 26235576, 26433377, 26435511 Mobile-9811068707

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Indian market seems to be at around 1 million units of monthly sales, out of which Karbon is selling round

15,000-20,000 units a month. Indian market is different from the rest of the world as the consumer needs have evolved simultaneously for greater needs of content cre-ation and consumption.

I think utilities remains a major deciding factor on the topic of tablets replacing laptops and it is more of need based. But for simple operations like browsing, games, emails—tablets are replacing laptop market as it involves low cost, but a professional utilizing high computing needs will continue to use laptops. It will also depend on the kind of features: like processors integrated into the tablets, memory capacity, and storage, among others.

But it has definitely captured the market as till now companies were not able to provide devices to their employees but with cheaper tablets coming in, the scenario has changed. In my opinion, the ‘prosumers’ (professional consumers) are the biggest growth drivers of the tablet segment.

Karbon is working closely with leading telecom compa-nies, aiming primarily at enterprise segment and this for us is a natural alignment as we are able to customize solu-tions for our customers with the help of our developers.

Our go-to-market strategy is: we are following a dis-ruptive approach in the tablet market leveraging on our alliances. We have launched 3G enabled solutions, bigger screen sizes mostly around 10 inches screen. After from usual telecom channels, it is the IT channels which are pushing sales and plays a very important role. We see traction on both tablets: 7 inches as well as 10 inches. In terms of innovation we are creating a necessary mobile ecosystem along with content provider aggregators. Our key growth verticals are pharmaceuticals, healthcare an education.

n e w s ta b l e t s 3www.dqweek.comSep 30-Oct 6, 2013

The DQ Week

Kapil WadhWa, Md, ChaMpion CoMputers

saurabh groVer, direCtor, aoC india business

indrajit sabharWal, Md, siMMtroniCs

V. balaKrishnan, sandeep arya, Md, aMtraK info systeMs

v e n d o r c h a n n e l s t r a t e g i e s

Indian tablet market is estimated to reach around 2.66 mn units and has grown about 901% y-o-y since 2011.

India has evolved immensely as a tech-savvy nation. The consumers today have the disposable income to spend

on the variety of trendy gadgets and prefer to use mobile web technologies. Multi-usage, enhanced user experience, changing lifestyles of consumers has boosted the tablet market in India.

The market has witnessed the entry of various low-cost tablets with latest software and application support system. Also, on the technological front, tablets are coming in with high-end processors like Quad core and Dual core, higher storage facilities, improved RAM, enhanced camera, 3G support and voice calling facilities.

Champion Computers have recently entered into a strategic alliance with India’s premier

telecom service provider, government-owned Bharat Sanchar Nigam Limited (BSNL) to cater

to the ever-growing ICT needs of the consumer. We have built a strong distribution network and

our products would be available in leading online portals, multi-brand retail outlets, traditional retail

stores and the BSNL outlets. We have also set up our service centers across 400 cities which

would further cater to the consumer needs and would provide superior

customer experience.We have appointed about

3,000 distributors across India and our products would be available across 4 channels: BSNL Outlets/franchises, online portals, large retail formats, traditional chan-nels.

Going by projected growth rates, the tablet-market size will be at least a third of the PC market size

in the ongoing year, which stood at 11.3 million units last year in India. A late entrant to the world of Smartphone and tablets, India, now seems to be moving in line with global trends. Ease of use, long battery life, mobility, ability to multi-task, instant on/off and substantial breadth of applications available have caused rapid growth and change in demand patterns. It is the enterprise segment that is driving the sales and adoption of this technology.

We are seeing a trend of tablet adoption in the education sector as well, although this is in primary level and will take little time to come up in a big way. We are also seeing a trend coming up in tier II, Tier III cities with opportunities for the range of budget tablets.

However, tablets as a category is still evolving globally, some see this as a convergence device between IT and telecom, which perhaps makes tablet attractive to telecom and IT channel equally. There are IT partners selling tablets where as there are few who still see a separate channel emerg-ing in course of time. Therefore, we are currently launching

AOC Breeze in the IT channel in cities, where we have strong distribution network and service set-up. We intend to build up our Telecom channel over the next few months and make our products available in all the major cities of the country by end of next quarter in both IT and Telecom channel.

gest medium of content creation and consumption. As far as Simmtronics is concerned: we are number 3 in the world after Apple and Samsung.

We are the only tablet OEM pres-ent in India with an advantage to give service and support efficiently. We manufacture our tablets in India apart from the facilities based in Dubai and Singapore, unlike many other players who import their devices from China. As an OEM we focus on products which are compelling and are successful with our Xpad range of devices launched in April this year. We are selling around 70 K tablets a month.

We are primarily aiming at target-ing consumers between age group of '15-28' years. We have been working through our distributor and channel network, both IT channels as well as telecom channel, for the sale of our devices. Recently we have tied up with HCL for the distribution of our devices and to widen our presence in tier-II cities and mid-market custom-ers from other cities. Also this tie-up will help us to place out products in Large Format Retails. Among the verticals corporate sector accounts

for our 20 % sales, followed by education with 15 %. We don’t subscribe to the concept of phablets—a com-

bination of smartphone and tablets—because these two have different set of features with different applicability and I don’t think it will replace tablet market. Nor I am convinced that tablets can grab laptop market share.

Tablets are going to stay for a long time especially because of price usability i.e. low computing IT device

for browsing, emails etc. The tablet market is growing everywhere in the world and in India. We don’t agree to IDC reports that world-wide tablet market saw a slump. India is a huge market for tablets as it is evolving as a big-

The tablet market is expected to grow at 40 %, from1.6 million units in the current financial

year to 7.3 million units by 2015-16. With concepts like BYOD still paving way in the market, there is a huge scope of penetration for tablet players, especially in tier-II and III cities.

Amtrak’s range of tablets have been designed keeping in mind the aspirations of having a high-end tablet, and making it available at an affordable range. We have focused more on the content of the tablet by offering applications which are not available in any other entry level tablet—such as, device and personal security application, and focusing a lot on the after sales services to the customers by offering a toll free number for customer care support etc.

Amtrak introduced the first ever localized pure education tablet solution, its recently launched education tablets in Rajasthan –Amtrak My Class Buddy A700 E and A722G E. The device is stuffed with valuable study materials and features. Sectors such as hospitality, automobile and pharmaceuti-cals hold promise apart from education. In many applications in these industries, you do not need to create content but employees can use a tablet as sales catalogues. Channel strategy is on top priority for us and this is the best way to increase its market penetration.

It is anticipated that the emergence of the 'giant mobile' or phablets, which blend tablets and mobile phones, will lead to a whole new category of gadgets and influence the pace of growth exponentially.

lets are used for order processing, contact management, information sharing, inventory monitoring and control, order tracking, customer management, sales forecast analysis and employee performance evaluation; there by a huge emphasis on mobility(read tablets) to generate real time data.

Also, with the rise of BYOD (Bring your own device) various professionals rely on tablets on simple operations like browsing, emails, presentations etc. However, profes-sionals utilizing high computing needs would continue to use laptops.

India: A unique marketIDC figures states that worldwide tablet shipments

experienced a 'sequential decline' as total volumes fell (minus) -9.7% from Q12013. But in India it grew manifold, as earlier stated. It seems that the Indian market dynamics is completely different from other, with different vendors following different strategies.

In India, one needs a different strategy from the global mar-ket as Indian market is diverse and each region has its own set of trends and preferences, says Uneaz Quraishi, director, sales and distribution, Asus India. He adds: “We are offering with a product line that excels in security, responsiveness and other. We do not compromise on the quality of our tablets, though we offer our product at different price levels.”

Echoing similar sentiments on India-as-a-key-differen-tiator over most other developing markets, Suneet Singh Tuli, CEO and president, Datawind said: “Awareness generated by the government’s efforts around the Aakash tablet has created broader interest in the segment than most other markets. Also, India is one of the most aggres-sively priced markets, where consumers take tablets as their first computer.”

Market shareAs per the latest CMR data on shipment shares of lead-

ing vendors, Samsung held the number one spot in the

last quarter with 21.2% market share, followed by Datawind with 12.5% with Micromax posi-tioning itself at number three with 9.7 %.

Vineet Taneja, country head, Mobile & IT, Samsung India said, “For Samsung, we have a 57.7% value market share in tablets, as of July 2013 and our product Note 510 and Tab 3 is seeing a good interest from large consum-ers, meeting both their creativity and consumption needs”

He added that tablet is rapidly gaining ground in India: “It is showing good sales in the retail segment as individual consum-ers are going in given the easy connectivity, portability and the rich multimedia experience. Also, the tablets are showing good traction in the education and the enterprise sectors.”

However, another leading India brand, though not in the CMR’s top three vendors list claims to be positioned at third spot in worldwide market.

Indrajit Sabharwal, MD, Simmtronics said: “We are number 3 in the world after Apple and Samsung. Also, we are the only tablet OEM present in India with an advantage to give service and support efficiently. We manufacture our tablets in India apart from the facilities based in Dubai and Singapore, unlike many other players who import their devices from China.”

Go-to-market and channel strategiesOne of the upcoming brand, Karbonn Mobiles is work-

ing closely with leading telecom companies, aiming pri-marily to tap enterprise segment. It has launched tablets

Continued from page 1

V&D Estimates

20.1%Apple

4.9%Micromax

2.7%Karbonn

17.3%Others

48.8%Samsung

2.5%Datawind

2.0%RIM

1.6%HCL

top tablet players (fy 2012-13)

playersrevenue (in `crore)

growth (in %)fy 2011-12 fy 2012-13

Samsung 1,109 1,999 80.25

Apple 442 823 86.2

Micromax 51 201 294.12

Karbonn NA 112 NA

Datawind NA 103 NA

RIM 121 83 -31.4

HCL 38 67 76.32

Others 252 710 181.75

Total 2,013 4,098 103.58

Others include- Lava, Zync, Spice, Swipe, Intex, Asus, Acer, Wishtel, Sony, Google, Teracom and Viewsonic

V&D Estimates

Total Market Size: `4,098 crore

with 3G enabled solutions mostly around 10 inches screen sizes. It is banking on innovations and creating necessary mobile ecosystem with content aggregators.

Shashin Devsare, executive director, Karbonn Mobiles stated: “We are following a disruptive approach in the tablet market leveraging on our alliances. Apart from usual telecom channels, it is the IT channels pushing sales and plays a very important role.”

As a whole, Tablets seems to capture everybody’s attention with new players entering into this segment. For example, AOC has recently launched AOC Breeze with strong distribution network and service set-up.

According to Saurabh Grover, Director, AOC India Business, the company intends to build telecom channel over the next few months and make their products avail-able in all the major cities of the country by end of next quarter in both IT and telecom channel.

He adds, “There are IT partners selling tablets where as there are few who still see a separate channel emerging in course of time.”

Another new entrant in the market, Champion Com-puters have recently entered into a strategic alliance with India’s premier telecom service provider, govern-ment-owned Bharat Sanchar Nigam Limited (BSNL) to cater to the ever-growing ICT needs of the consumer.

Kapil Wadhwa, MD, Champion Computers says, “We have built a strong distribution network and our products

would be available in leading online portals, multi-brand retail outlets, traditional retail stores and the BSNL outlets. We have also set up our service centers across 400 cities which would further cater to the consumer needs and would provide superior customer experience.”

Segments

Many vendors are now focusing on tier-II and tier-III cities are they are seeing a huge growth potential from these areas. Education segment sees a big adoption of tablets. Brand such as Aakash by Datawind and Amtrack have already deployed many such projects.

There have been enough reports around Aakash tab-lets. Meanwhile, Amtrak introduced an education tablet solution in Rajasthan with Amtrak My Class Buddy A700 E and A722G E.

Sandeep Arya, MD, Amtrak info systems said: “The devise is stuffed with valuable study materials and fea-tures.”

Apart from education, automobile, healthcare and phar-maceuticals verticals are seeing a big demand. Recently Acer India sold 1000 tablets to an automobile dealer. Acer, however, did not name the company.

Note: Apple is not a major player in tablets in India as its market share is just around 2 %, with very niche consumers, according to various reports, so we have not mentioned about Apple.

Tablet is the new PCHow the Tablet Market Stacks up

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