Mitsubishi targets top end of the Indian cell phone market

Sabil Francis

agencyfaqs!

NEW DELHI, October 4

Mitsubishi Electric might be late coming into the market, but it is in a belligerent mood. The company has launched three mobile phone models — Cosmo, Aria, and Geo — of its global brand Trium. It will launch other models soon and is planning to capture a 10 per cent to 15 per cent market share by mid 2001.

"We will go in for an aggressive, hard-hitting advertising campaign, and emphasize on the features of the product," stressed S.S. Bassi, country manager, Mitsubishi. Mitsubishi will kick off a major advertising campaign in the media today. The focus is on the corporate segment of the market. Though company officials were reluctant to give figures, agencyfaqs! sources say that Mitsubishi will spend roughly Rs 5 crore in the next four months on advertisement.

Technology. That's where Mitsubishi thinks that it can beat the rest. Like dual-band capability. Mitsubishi phones can also support roaming facilities in most parts of the world except the US. In layman's terms, this means that Mitsubishi mobile phone users can use their phones abroad, a feature which company officials claim, no other player in the market is offering as they offer single band access. "If you use our phones, your communication does not break down whenever you go abroad. It's as simple as that," says Bassi.

The company is also looking at the future, and is planning to launch high-powered handsets with WAP and GPRS (general packet radio switch) technology. Most mobile networks in Europe have started to roll out GPRS services, and Mitsubishi plans to do the same for India by the end of this year. The GPRS is a packet-based enhancement to the existing cellular network infrastructure and can allow mobile Net access at a bit rate of up to 160 kbps.

GPRS phones will get rid of worries on high dial-up costs and time-based charging associated with WAP-based Net access, which is the next phase of mobile phone technology. Mitsubishi is trying to skip the mobile phone market evolution, and has the first mover advantage in the brutally competitive high-end mobile phone market.

To distribute its products, the company has tied up with the Israel-based HAT trade Ltd. HAT has already distributed the Trium Range in Israel, South Africa, Bulgaria and Rumania. Says Issac Waldman, president and chairman of HAT, who has criss-crossed the country for the last one-and-a-half year, testing the waters of the Indian market, "The problem of the Indian market is that there are too many players and too few consumers." HAT will in turn tie up with local distributors to supply the market.

To ensure that there is no competition between distributors, the company has decided to appoint only one distributor for a region. agencyfaqs! sources said that though the system is in place now, there are fears that Mitsubishi, like Siemens, might use these solitary local distributors in the first stage to establish market presence, and then appoint more such distributors to capture a greater share of these regional markets.

The company also might find that the price-conscious Indian consumer giving the Cosmo a wide berth and reaching out for the Aria. The Cosmo weighs 60 gm while Aria is around 80 gm, but that's not much of a difference when you hold it in your hand. Other than that the Cosmo model is stylishly oval shaped, and has an analog clock on its screen, features that may not count for much with the price-driven Indian consumer.

"We'll see," says a combative Shiego Ikeda, director, Mitsubishi mobile phones. The company has the same touch theme as Airtel in its advertisement jingles. Quips Bassi, "They say touch tomorrow. Why wait? With our phones you can touch tomorrow today."

In a departure from the market strategy of its competitors — who have targeted the lower end of the market, Mitsubishi is muscling into the corporate segment. For example, since 1995, when Ericsson first entered India, it has launched approximately 30 models. Of these, close to 70 per cent are entry-level phones. Only about 10 per cent of Ericsson phones are aimed at the luxury segment of the Indian market.

Worldwide, Mitsubishi Trium has a fairly equitable presence. It has 28 per cent of the mobile phone market in Japan, 8 per cent in Europe, and 9 per cent is Asia. The size of the global mobile phone market is estimated at 450 million units. In comparison, the Indian market is small - a mere 1.5 million units are likely to be sold this calendar year. Yet, the silver lining is that the domestic market is expected to grow at 100 per cent, with sales of 2 million and 4 million units in 2001 and 2002, respectively.

The growth may be there, but will it go the Mitsubishi way?

© 2000 agencyfaqs!