Vikas Jain, Business Director, Micromax

As new models are introduced, prices fall and demand grows for ever more sophisticated models, the mobile device market in India is growing fast and becoming increasingly competitive. (See iPhone 4S Debuts With a Lofty Price Tag, RIM Adds NFC to New Blackberry Devices and Tablets Get Hotter, Competition Intense.)

Research firm IDC expects mobile phone shipments in India during calendar year 2011 to reach more than 184 million and grow during the next four years as a compound annual growth rate (CAGR) of 13.03 percent to reach 301 million in 2015. Of that forecast total for 2015, IDC expects smartphones to account for 77.5 million (more than 25 percent).

And while the earlier years of India's mobile market growth have been dominated by global giants such as Nokia Corp., Motorola Mobility Inc. and Samsung Corp., domestic vendors such as Micromax Informatics Ltd. are growing fast and are expected to increase their share of the market in the coming years. (See Salora Joins India's Handset Fray, Tablet Vendors Eye India Opportunity and Device Microvendors Gain Traction.)

Micromax, which recently appointed a new CEO and divisional heads, is now believed to be India's third biggest handset player, with a 6.9 percent market share and estimated revenues in the financial year 2010-11 of INR 22.89 billion (US$441 million), up 43 percent from the previous year.

Micromax isn't just focused on growing in India, though. It is on an international expansion spree and has already launched operations in Nepal, Sri Lanka, the Maldives, Dubai, Brazil, Bangladesh, Russia and South Africa. (See 2011's Top Device Trends, Micromax Plans Tablet Launch in Early 2012, Micromax Enters Brazil and Micromax Starts Maldives Operations.)

Light Reading India recently caught up with the company's Business Director Vikas Jain, who shared some thoughts about market trends and the companys growth plans and new launches.

Here are the key excerpts from the interview.

Light Reading India: Micromax has inspired many domestic players to build a strong presence in the Indian handset market. How have you managed to create such a strong impact?

Vikas Jain: For any brand to succeed, its extremely important to have a long term vision and strategy in place to differentiate from what others are already offering. At Micromax, our strategy has always been to provide products suitable for the Indian market at the best possible prices. Right from the beginning, we have positioned ourselves as a device player that strives toward providing a quality experience at an affordable price. And thats where the idea clicked with consumers.

Light Reading: Does that mean the Indian handset market is going to be dominated by players that can provide devices at low prices?

Vikas Jain: No, there are several other factors. While the market is certainly curved towards price-sensitive zone, one should also realize that the Indian consumer is getting more and more mature now and if your product cannot match their expectations in terms of quality, even at low prices, failure is on cards. Its all about providing devices that could offer value-for-money to the consumers. For instance, the launch of iPhone 2G was really not successful in India, however the sales of the iPhone 4S are comparatively better. Its for a simple reason that it offers better value to the consumers, even if the device is expensive. Not only does the device have beautiful hardware, but it also ranks high on the experience of software, with all the high-end 3G features.

Light Reading: According to Voice&Data, Micromax is now the third largest handset player (in terms of revenues) in India. Whats your next target now?

Vikas Jain: Well, its for you people to work out [laughs]. We are happy to be featured amongst the top three Indian handset players. However, we have not set a certain time period to succeed to the second or to top position. In fact, rather than focusing too much on any numbers game, we would continue to focus towards launching more quality devices that could fit into the present day ecosystem.

The next step is to launch bundled 3G-enabled devices in partnership with top carriers. We believe that 3G is a wonderful opportunity to upgrade the handsets that could provide true value to the consumers. There are certain set of applications that a consumer can now use.

Although I cant reveal much at the moment, we are also working with application providers to understand the core requirement of a consumer [so that] we can provide value to the consumer. We are rather thinking about enhancing our image... [we] want people to be proud of our brand.

Light Reading: How about entering the enterprise domain, which has become really tempting for device makers?

Vikas Jain: We are certainly not overlooking the enterprise opportunity. The needs of enterprises are absolutely different and need some serious brainstorming before we could come up with devices. Hence, we are discussing with the technology heads of some of the leading enterprises and will soon unveil customized devices specific to that community. The enterprise market is always centric towards relevant [specific] applications developments... we are just working towards that and also discussing with operators for bundled devices.

Light Reading: When are you going public? You have delayed your IPO once again...

Vikas Jain: Its a difficult time and we have no impending urgency.... I cannot predict the day and timings of our IPO.

Light Reading: The Indian tablet market is also getting spicier and there are lot of expectations from Micromax; especially after the launch of Aakash. What is Micromax doing regarding the launch of tablet devices?

Vikas Jain: Its a big opportunity and we are seriously looking at it. The tablet device itself promises a lot of expectations... [currently] it is a second or third computing device, and we will make our strategies accordingly. But as far as competition is concerned, we will have different brand positioning. Aakash has a very different positioning. I believe its a thin client with lot of cloud capabilities attached to it. The government has subsidized the device, to help students. Its not possible to give you many details, except that, as promised earlier, youll see the launch of our tablet before March 2012. It will be a revolutionary product, with all the modern day features embedded in it and it will be priced at less than INR 15,000 [$289].

Light Reading: You also have dongles in your device portfolio. Whats your market share in that space?

Vikas Jain: We already have partnership with carriers including Bharti Airtel Ltd., Bharat Sanchar Nigam Ltd. (BSNL), Mahanagar Telephone Nigam Ltd. (MTNL) and others. While we do not have any audit result with us, I can say that we are selling around 70,000 to 80,000 dongles on 3G or GSM technology. We are not offering datacards based on [CDMA] EV-DO based technology.

Light Reading: Micromax is expanding in the overseas markets as well, which is a great strategic shift for an Indian handset manufacturer. How much these markets contribute to your revenues?

Vikas Jain: At present, we have presence in nine [other] countries from where we generate around 15 percent of our revenues, with the rest coming from India. We are experimenting and launching devices for specific customers in these countries. We are the second largest handset manufacturer in Sri Lanka in a span of just 18 months. In Sri Lanka we rolled out a device specifically for the fisherman, which has been a huge success. We have some aggressive plans in Latin America, which is highly advanced and is set for 4G technology.

Light Reading: What are going to be key focus areas for you in 2012?

Vikas Jain: As we have already discussed, tablets, the enterprise market and expanding our brand in markets beyond India are going to be key focus areas. We are also testing LTE-based devices with top operators [industry sources suggest Bharti Airtel is one of those operators] and will roll out those in due course. We are also strengthening our distribution channel in India. At present we are reaching out to 65 percent of the addressable market and planning to further expand our reach to [a further] 12 percent this year.

Jatinder Singh, Principal Correspondent, Light Reading India