The mobile phone giant you've never heard of

NEW DELHI, India — When the World Cup kicked off last month, residents of metropolitan India were a little perplexed at the advertising blitz that came along with it.

Instead of the usual host of international and domestic giants like Vodafone and Reliance, the biggest spender appeared to be a company that nobody had ever heard of. Its name is Micromax. It makes mobile phones. And it's Indian.

The knock on India has always been that it doesn't do hardware. But the latest news in the country's red hot mobile market is local. Building on a bundle of bargain-priced, innovative features and a lucrative revenue-sharing agreement for dealers, upstart handset maker Micromax has over the past five years quietly surpassed Korea's LG Electronics to become the third largest player in the world's fastest growing mobile market. And now a dozen-odd copycats suggest that the trouble is just beginning for traditional heavyweights.

"They have acquired nearly 12 to 15 percent share in the Indian handset market [in just a few years]," said Shushmul Maheshwari, head of market research firm RNCOS. "The coming five years will definitely prove a big blow to the traditional giants like Nokia, Samsung and LG."

With close to 10 percent of India's 100 million-handset market — and a target of 20 percent — Micromax, for one, is already expanding internationally. The company has offices in Hong Kong, Dubai, Nepal and the United States. And Vikas Jain, the company's CEO, says others won't be too far behind. "You might see a lot of the Indian portfolio going global now," Jain said.

"Indian players are innovative and offer low-cost handsets, which have great potential in underdeveloped and developing countries like Nepal, Bhutan, Srilanka, Bangladesh, Middle East and some Latin American countries," said Maheshwari.

India's $10 billion-handset market has gone from only five players in 2008 to nearly 30 different phone makers in 2010. And with new players taking nearly 20 percent of sales at the end of 2009, according to International Data Corporation, it looks like a whole new world.

Apart from Micromax, there are a host of new local players, like Karbonn, Lava International, Maxx Mobile Communications, Spice Mobiles and Zen Mobiles.

But that's not the only story here. While some of the local mobile companies are linked to bigger Indian empires, Jain and his three partners are all first-generation entrepreneurs — the exception in India's family-centric business culture.

And where most companies still prize seniority, not a single employee at Micromax's corporate headquarters in Gurgaon looks a day over 25, and two or three, including the head of press relations, may not yet have started shaving. This is the new India and they're not likely to settle for nibbling around the edges of the low-end market segment.

http://www.globalpost.com/dispatch/india/100721/mobile-phones-market-micromax