Abstract
Indian companies began releasing a series of low-price ICT products in early 2008. These include notebook PCs from HCL and an ultra low-priced mobile phone from telecom operator Spice. This report analyzes the rise of low-price ICT products in India and examines the underlying factors of India's low- price trend from the angles of economic development, government policy, and product design.
Product Design Catering to India's Mid-range to Low-end Consumer Market Segments
Judging from income levels, demand of most of India's mid- to low-end consumers still centers mainly on food, clothing, transportation etc. From there, demand is also expanding to education and leisure. Expenditures on products for everyday use are mainly low-cost products.
For international electronics companies, the key lies in how to provide the majority of consumers in India with simple, practical, and affordable products that offer simple, adequate functions to meet the most basic requirements. This is the most important aspect of gaining a foothold in the Indian mid-range to low-end consumer market.
Key Policies of the Indian Government and Opportunities in the Low-price ICT Product Market
In this low-price product trend, the Indian government aims to narrow the digital divide and raise the penetration rate of ICT products. It is anticipated that it will continue to support domestic product R&D and manufacturing for low-price PCs and mobile phones, in order to meet the communication and IT needs of the Indian people.
Setting up facilities in India or enhancing cooperation with Indian companies which have assembly and maintenance capabilities, so as to avoid the problems of after-sale services and taxes, are strategies beneficial to international vendors. In this way companies obtain a cost advantage. Sufficient knowledge of the status of policies being promoted in India and development of local brands such as HCL and Reliance is critical, and could provide opportunities to win bids or seek partnerships with Indian companies.