India beats US as 2nd largest smartphone market

India has overtaken the United States as the second biggest smartphone market during the quarter ended September as its shipments crossed a record 40 million mark for the first time.

According to a report by analyst firm Canalys, India registered a growth of 23% during the period. The US has shipped nearly 39 million smartphones in Q3 2017 compared with 38.3 million in Q2, 2017.

“Samsung and Xiaomi, which shipped 9.4 million and 9.2 million units respectively, accounted for almost half of the total market as the top five vendors continued to post strong growth in Q3 2017,” the report said.

Since India has 1.3 billion population compared with the total population of 320 million in the US, the growth is on expected lines, Canalys said.

While strong sales of Xiaomi devices drove the growth in India, below than estimated sales of iPhone hunted the US smartphone industry in Q3 2017.

The lukewarm response received by iPhone 8 series devices hunted the overall sales performance of iPhone in the third quarter of 2017.

Commenting on the development, Canalys analyst Ishan Dutt said the growth comes as a relief to the smartphone industry and clears the doubts about India’s market potential.

“There are close to 100 mobile device brands sold in India, with more vendors arriving every quarter. In addition, India has one of the most complex channel landscapes, but with low barriers to entry. Growth will continue,” said Dutt.

The major five mobile phone players who account for 75% of market share include Samsung, Xiaomi, Vivo, Oppo and Lenovo. The contribution of Indian brands are yet to pick up to beat the Chinese mobile competition.

The Canalys report states that low smartphone penetration and the explosion of LTE are the main drivers of the current growth. Also, the analyst finds that it comes at a time when demonetisation impacted the purchasing behaviour of citizens across the country.

US is also gaining ground in Indian smartphone market with its Apple and Google products.

The US is reported to have shipped a record 2.5 million devices in India in 2016.