India, a country known for its massive population, is also the world’s second-largest smartphone market, right after China. With around 750 million users, it is clear that technology plays a crucial role in the lives of Indians. However, despite the growing number of smartphone users, there is still a significant portion of the population that finds it challenging to afford a brand-new smartphone.
Many Indian consumers, rather than investing in a new smartphone, choose to stick with their existing feature phones or only upgrade to a new feature phone. This trend has led to growth in feature phone shipments in the country, despite these phones being considered outdated compared to smartphones.
According to data from Counterpoint, feature phone shipments in India experienced a 10% year-on-year growth last year, a significant increase from the -31% in 2022. Specifically, 4G feature phone shipments saw a rise to 25% in 2023 from 9% in 2022, while 2G feature phones continue to dominate the market with a 75% share.
Reliance Jio, a major player in the Indian telecom industry, leads the 4G feature phone market with a share of 27%. The company offers a range of models in this segment along with dedicated tariff plans and access to digital services like Unified Payments Interface and popular apps like JioCinema, JioTV, and WhatsApp.
Despite the growth in feature phone shipments, there are challenges hindering smartphone adoption in India. Tarun Pathak from Counterpoint mentioned that the 4G feature phones from Jio have impacted smartphone adoption as consumers can access basic apps on their feature phones.
To address the challenges in attracting first-time smartphone buyers, Jio is reportedly planning to launch a 5G feature phone. This move aims to get phones into the hands of more Indians and further expand its reach in the market. The 5G feature phone will run on Linux-based software KaiOS and is currently in the prototyping phase by contract manufacturers Dixon Technologies and Neolync.
In addition to the 5G feature phone, Jio also plans to launch a 5G Android tablet and a 5G smartphone this year. This expansion into the 5G space aligns with Jio’s efforts to grow its telecom revenues and capitalize on the increasing demand for 5G connectivity.
Despite the growth in smartphone shipments in India, there are still challenges in transitioning feature phone users to smartphones. With a significant portion of the population using feature phones due to affordability issues, smartphone brands are exploring different strategies to attract buyers, including offering finance options.
While India has some of the cheapest smartphones globally, the affordability of these devices, relative to users’ income, remains a barrier for many. As the country continues to bridge the digital divide and expand its smartphone market, addressing the challenges faced by potential buyers will be crucial in driving further growth and adoption of smartphones in India.
