[China] China handset makers shifting to smartphones, pushing sales to emerging markets, say sources


Demand for 2G feature phones in the China market is expected to subside in the next three years, pushing China-based handset makers to focus on the production of entry-level to mid-range smartphones and also to promote overseas sales, according to industry sources.


Sales of handsets in China grew by 10-15% on year to 260-280 million units in 2011, of which smartphones accounted for 70 million units.


However, total handset sales in the market are expected to drop to 240-250 million units in 2012, of which smartphone models will top 100-120 million units, increasing 43-70% from the previous year, said the sources, adding that handset sales are likely to remain flat in 2013-2014.


With a shrinking share in the 2G segment in the home market, China-based second-tier and white-boxed handset makers are strengthening their ties with retail chain operators or branded vendors in emerging markets, the sources noted.


China-based maker G'Five currently takes up the third-rank title in the India handset market with 7.5% share, trailing after Nokia's 37.2% and Samsung's 14.9%, according to data compiled by ABI.


Other brands in India, including Micromax, Spice, Karbonn, Maxx Mobile, Lava and Zen Mobile, have also maintained close ties with China-based handset makers, the sources added.


Source: Digitimes