The battle of 4G: Is India a dumping ground for Chinese phone makers?

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The battle of 4G: Is India a dumping ground for Chinese phone makers?
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The 4G battle has already begun between India and China with the latter taking a substantial lead in the Indian smartphone market for the high-speed devices.

The homegrown brands are of the opinion that their rivals have been dumping handsets in the country ahead of networks being properly rolled out. However, the accusation has been rejected by an executive at one of these rapidly growing Chinese firms.

The executive said Indian sellers are having a tough time because the companies they have been sourcing from in China have entered India and this is the reason why Indian firms have failed to catch the 4G market.
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On the other hand, Indian companies said that these devices might not even be properly enabled for the kind of 4G services being rolled out in India. Chinese companies are treating India as a "dumping ground" for 4G phones that may not have Band 3 or the 1800 MHz band, said Vikas Jain, cofounder of Micromax, India's No. 2 phone seller.

This is one of two bands on which India has allowed 4G LTE services, the other being 2300 Mhz.
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Pardeep Jain, Karbonn Mobiles MD, is of the view that Chinese vendors have been dumping excess 4G inventory and playing the price game to gain market share. "They are worried that all manufacturing facilities are coming to India, so what they will do now? These companies have wrongly projected the market demand in China and are now dumping that extra inventory in India at lower cost," he said.

Bharti Airtel has commercially launched 4G services while Reliance Jio, Idea Cellular and Vodafone India will do so either later this year or in 2016.

Arvind Vohra, country CEO and managing director of Gionee India, has different story to tell. He said the company's phones are priced higher than those sold by local rivals and of excellent quality. "Our pricing of devices is much higher than Indian players. Besides, our devices are world-class. There's no question of us dumping substandard products in India."

The question arises, why Chinese phone makers are ahead of local sellers? It is because they have made early inroads. Chinese handset makers Lenovo, Xiaomi, Huawei and Gionee accounted for 12% of total India smartphone market in Q2, up two-fold from a year ago, as per IDC.

As for 4G phones, Chinese players have have 45% of the market while Indian makers have less than 10%. Samsung, which sells the most mobile phones in India, leads in 4G as well. The segment surged 150% in the June quarter from the preceding one.
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The other reason is Chinese companies have also been able to leverage the online model in India. "Key to the success of the Chinese vendors has been popular flash sales through online players such as Flipkart, Snapdeal and Amazon," said Kiran Kumar, senior analyst at IDC India.

"At the same time, they also focused on bringing more 4G phones at affordable $100-150 (Rs 6,700-10,000) price points, which are left unattended by Indian and global vendors."

(Image: Indiatimes)