Aug 21, 2011

Indian mobile cos RCOM, Micromax, Bharti and Lava make rush to launch tablet mobiles starting at Rs 7,000 to lure first-time buyers

If iPad is the only word that comes to mind when someone says tablet, here's news for you. It's not just the Apples and Samsungs that are dishing out these fancy mobile PCs with a flat touch screen not much larger than your cellphone. A number of Indian companies - big and small, well-known and obscure - are launching tablets almost on a daily basis; a few of them are putting out several models in a day. The best part: they are being launched at mouth-watering prices to seduce first-time buyers and steer them away from laptops and netbooks.

The smaller the company the more ambitious is the launch. Take, for instance, Lakshmi Access Communications Systems (LACS). The Bangalore-based equipment maker, earlier unknown to the Indian tablet scene, launched 14 tablets starting from Rs 6,999 on Friday. The tablets will be available on shop shelves from September while online bookings will open within 10 days.

During the week, Reliance Communications (RCOM) and Bharti Airtel's handset arm, Beetel Teletech, shattered price barriers by launching tablets starting at Rs 12,999 and Rs 9,999, respectively, within days of each other.

Not unpredictably, it was the Chinese bandwagon comprising manufacturers such as Huawei and G'Five that triggered the price wars. G'Five's tablet sells for Rs 10,000, which is less than a third of the cost of Motorola's Xoom 3G, which retails at just under Rs 33,000.

Indian players are responding in style. Other than LACS with its Magnum range of Android tablets, companies such as Lava, Micromax, Zen, Olive, and Fly are also readying to launch affordable tablets. These mobile handset winners now hope to do an encore with tablets. Delhi-based Lava Mobiles plans to introduce a tablet next month that will be priced between Rs 15,000 and Rs 20,000 on an Android platform, the company's director SN Rai recently told ET. This would be around the same time Huawei begins selling its high-end tablet MediaPad from October, a company executive said.

Lesser-known Fly Mobiles will begin with a range starting at Rs 8,000. "Price will be the key factor in deciding the winner," says CEO Prem Kumar.

Tablets are essentially meant for content consumption rather than content creation. They are being used for photo and video viewing in homes or presenting a quick slideshow to a client, says Vyomesh Joshi, executive VP at HP, which recently launched HP TouchPad.

In a strategy similar to that followed by low-cost Indian handset makers, most tablet makers are relying on the volumes-focused Chinese contract manufacturers.

We follow the same contract manufacturing model that everyone does," says Mahendra Jain, managing director, LACS. RCOM's tablet is also sourced from Chinese equipment maker ZTE.

By doing so, Indian tablet marketers would be looking to erode the share of large MNCs in the same way the handset players slowly but surely chipped away at Nokia's share. Most tablets use Google's Android operating system that is available for free and has a huge apps store for consumers; a few Windows-based tablets below Rs 15,000 are also available. 

After-sales service is crucial for tablets. Larger brands have dedicated service centres - a luxury low-cost tablet users may not be privy to. However, LACS' Jain says service will be the company's main proposition. Its tablets come with two warranties - an 'upgrade' warranty wherein the consumer can graduate to a new tablet by returning the existing one and having its value assessed, and a 'swap replacement' warranty under which LACS will take back a damaged device and replace it within two days at no additional cost.

According to International Data Corporation, the tablet PC market in India is estimated at 200,000-300,000 units a year. "We believe the market size would be between 250,000 and 500,000 units in 2011. We are targeting a significant part of this market with our lineup," says Ranjit Yadav, Samsung India's country head (mobile and IT).

But the going may not be that easy. Indian consumers are likely to be confused about the usage of tablets rather than be attracted to the low price points, says Gartner principal research analyst Vishal Tripathi.

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