White box tablets may be out, but OEM and accessories could be an opportunity.
While the overall market for smartphones has been growing steadily over the past year, and is expected to grow to become the second-largest market in the next few years, the tablet market has lagged behind. The market has been particularly challenging for white box tablet makers in India. The Bureau of Indian Standards (BIS) in 2013 introduced new regulations that essentially made the sale of unbranded tablets impossible.
The regulatory body required that quality certifications had to be screen-printed on the device itself and that this (or any other hardware changes) could not be done anywhere other than the source location. Given the relatively small size of the market, this often makes it unfeasible to compete against domestic manufacturers.
Nevertheless, while sales of unbranded tablets has become unattractive, tablets built for branded OEM tablets and tablet accessories could remain an attractive market. Overall, there were just short of 1 million tablets sold in Q4 2014, and a total of about 3.5 million units shipped in 2014 according to IDC.
Unlike many other markets, most tablets shipped in India were not WiFi-only; WiFi-only tablets only made up 19 percent of the market, down from 48 percent in Q1. Instead, 63 percent of tablets included 3G capabilities in Q4, up from 35 percent at the start of the year. Inexpensive, sub-US$150 tablets with 7-inch screens dominate the market, according to IDC. 4G-capable tablets are expected to increase share in the second half of 2015 as carriers upgrade their networks over the course of the year. In addition, major government and education projects are expected to increase the market for tablets in 2015.
As for the top vendors, IDC estimates that Indian manufacturer iBall has become the largest tablet supplier by units shipped, holding 15.6 percent of the overall market. The company headlines a group of several Indian manufacturers – most notably DATAWIND - who have taken significant market share over the past year with the loss of competition from Chinese white box manufacturers and the failure of major brands like Samsung and Apple to capitalize on the void produced. For example, in Q2 2014 Samsung held the market lead with 22.5 percent of the market and Apple following with 14.4 percent. In Q4 2014, Samsung’s share had fallen to 12.9 percent and Apple fell out of the top 5 manufacturers entirely. In their place, domestic manufacturer DATAWIND held 9.6 percent of the market, Lenovo held 9.4 percent and HP took an 8.7 percentshare.