Tablet Ecosystem in India – Current State, Potential & Outlook.
Since the release of the Apple iPad in April 2010, the tablets market has seen an explosion globally.
Samsung released its product in Q3 2010 and since then, there has been a barrage of tablets from the Android stable. The market grew from 16 million units in 2010 to 70 million (preliminary estimates) in 2011, with North America and Europe leading adoption, followed by Asia.
The west has also seen a steady adoption of these devices in key verticals such as education, healthcare, aviation and retail, with educational institutes leading the way in exploiting the functionalities that tablets have to offer.
Because tablets offer an intuitive UI, portability and instant access to digital content, they have become the ultimate all in one consumption device to serve a wide variety of use cases across key services across the entertainment, utility and productivity segments.
As for the Indian market, the Samsung Galaxy Tab had this market all to itself up until the release of the Apple iPad 2 in May 2011. The iPad 1, released at the end of its global life cycle in India, did not find too may takers.
Apple went from a minor player (Samsung had the lion’s share of over 80% between October 2010 to April 2011), to being a strong leader with over 55% share between May & September 2011. As tablets from every brand (handset and PC segments) launched in the market, the key players remained Apple and Samsung.
With over 30 Android tablets now available in the market, the platform has an edge over Apple in India cumulatively, unlike in western markets. Android tablets have also led the way for entry-level tablets, with a range of price offerings in the market in the low- (up to $250), mid- ($250-$500) and high- (over $500) end segments. But multiple Android OS release have led to fragmentation. As with other consumer markets, key success factors for tablets in India are extendable memory support, USB connectivity and a long battery life.
The market has also seen the introduction of tablets targeted at specialized verticals such as education and enterprises. The government announced the Aakash initiative, with the intent of offering $35 tablets subsidized to students, creating further interest and opportunities for the Indian market. As the first of the educational institutes consider deployments of tablets, Telecom operators such as Reliance have also rolled out tablets with attractive tariff plans and at mid-tier rates.
The tablet value proposition for the Indian consumer is dependent on a combination of affordability, user experience, aspiration and utility. As the core value proposition is yet to be understood by consumers (as certain consumer segments question the need for a third device), the tablet’s ability to be ‘something for everybody’ needs to be optimally exploited by the various players for the Indian market. There are challenges for adoption – lack of ubiquitous 3G coverage and faster data speeds deter users from an optimal user experience, prevalent digital privacy, low digital content sales and lack of alternate payment models are all impediments for uptake of tablets.
Globally, tablets are following the adoption path of smartphones and not of netbooks. We believe it will be a similar case in India as well. In 2012, a majority of the sales are expected to come from the retail channel and consumers will choose to purchase either a smartphone or tablet but not both (at least within six to nine months of purchase of the former).
Significant adoption by verticals such as education and the unconnected segment is not expected before 2013. Tablet adoption in India has been projected from the installed base, as well as growth of different mobile phones and other ecosystem enablers. Based on all these scenarios, we expect tablets could potentially reach over 5.5 million units by 2014.
To highlight the opportunities that India presents, the India market breakdown is as follows at the time of release of this report. India currently has over 100 million active Internet users, over 50 million PC owners, between 15 million and 18 million 3G subscribers, over 140 million TV households, over 540 million unique mobile device owners, over 20 million smartphone users, over 2.3 million IT and ITES workforce and over 36 million Facebook users.
In addition, on the ecosystem front, the world knows that ‘there is an app for every need’, Touch interfaces have changed usage paradigms, The Indian Government has ambitious plans to marry technology with the education sector, the 2012 global tablet projections are over 110 million and China, Taiwan based ODMs are driving economies of scale.
It is up to the ecosystem players to navigate through a highly fragmented retail universe, diverse consumer segments, unique customer expectations and complex market dynamics and capitalize on the market opportunity called India.
The entire report is available for download here. (5.8 MB PDF)
Via : Convergence Catalyst