Nokia could certainly look to divert its attention from the production of smartphones for the North American continent and switch to producing phones for a country with the second largest population in the world. India, as a country has shown remarkable growth in the cell phone market and what’s surprising is that the country seems to prefer feature phones over smartphones. This could serve as a perfect platform for Nokia, as it can exploit these factors into making quarterly profits and compensating for the losses incurred in the North American continent.
Companies fail to understand that the smartphone culture is yet to catch up in third world countries and thus produce phones that only interest countries in Europe and North America. Feature phones continue to remain the undisputed king of the mobile sector in countries like India and people clearly prefer feature phones as their first choice. Nokia must exploit this fact, because the feature phone era is yet to attain maturity in third world countries and by the time that happens, nearly 3.2 billion people would be using feature phones. When you are assured of such a large base of customers, the obvious conclusion would be to invest. With 911 million active mobile connections (dual sim and inavtice numbers included) the country is an ideal target for Nokia and the company’s make and manufacture is ideally suited to gratify the needs of an emerging market.
Feature phones account for 90% of mobile phones in India. While this may surprise people in North America and Europe, the figure is not expected to show any drastic change for the next five years. The reasons preventing the switch to smartphones are: low per capita income, lack of 3G infrastructure and lastly no pan India service plans. As already mentioned the high cost of 3G infrastructure has prevented companies from providing access to cheap 3G services and thus eliminating the possibility of an immediate switch to smartphones that are heavily reliant on fast internet.
In fact the Government’s decision to auction the spectrum resulted in a high price, leaving companies with no or little money to invest in further development of infrastructure. Companies were forced to auction for various circles, eliminating the possibility of a pan India 3G data license. Despite the arrival of 3G, the interest generated has been minimal and thus feature rich phones will continue to remain the country’s lifeline, at least for a few more years.
