New Delhi: The Indian mobile handset market, second largest in the world, is expected to grow in single-digits in 2020, lower than the 2019 levels, as consumers are hesitant to upgrade to entry level smartphones and are holding onto their devices for a longer time.
Market research firm TechArc, in its forecast on 2020, said that the overall market will see 2% dip compared to sales in 2019, attributed to continuous fall in sales of feature phones as well as smart feature phones. Counterpoint Research predicts a 6-9% growth due to low demand of feature phones. International Data Corp. (IDC) also expects double-digit growth will be difficult to achieve.
“There are about 450 million smartphone users as compared to 550 million feature phone users in India. About 40-45% of feature phone users own a device at less than Rs 1000. So the cost of ownership, the lack in internet literacy and the rigidity that feature phones have is holding the users back from buying a smartphone,” said Navkender Singh, Research Director, IDC India.
He added that there was rapid growth in the smartphone market two-three years back as people were replacing their phones within 12-16 months. Right now, the replacement cycle has increased to 16-20 months as they are getting better affordable phones.
“Beginning 2019, we are now seeing market moving towards pricier smartphones. This means that the average spend of a consumer on a smartphone has gone up to Rs 15,000. It is but natural that as my investment on any gadget increases, my hold period of that gadget also increases,” said research firm TechArc’s co-founder Faisal Kawoosa.
The Average Selling Price (ASP) of smartphones is expected to rise by 8.4-8.6% and settle between Rs 15,500-15,800 in 2020.
Source: Economic Times