Why are smartphone brands like Xiaomi, Micromax, OnePlus, Motorola Mobility, Honor and Nokia making an easy transition to TVs? Reports suggest, OPPO might be the next one to enter the space.
Xiaomi, Micromax, OnePlus, Motorola Mobility, Honor and Nokia - all these are primarily smartphone brands. Do they sell phones and phone accessories only? No. These brands seem to be on the path to becoming wider consumer electronics brands and all of them have added Smart TVs to their portfolios. The most recent entrants to the space are Nokia, Honor, Motorola Mobility and OnePlus. The latest industry buzz suggests OPPO, another smartphone brand, may just be the next one to enter the fray.
The earliest to enter the game was Micromax, which is now positioned as a consumer electronics brand. In the last few years, Xiaomi has widened its footprint outside electronics. Motorola, Nokia, OnePlus and Honor are among the latest entrants in the TV space, having announced their Smart TV extensions in late 2019. Xiaomi entered the space in 2018 while Micromax had already registered its entry into the segment in 2016.
Earlier, the transition used to be the other way round with traditional consumer durable brands like Samsung, Videocon, Sony and Philips venturing into the smartphone business, extending their legacy brand identities.
What exactly is a smart TV? It’s any television that has an operating system and can connect to the internet. The TV might have in-built capabilities or need an external device like a Chromecast which can be connected via HDMI ports. The internet connection is primarily used to stream web series and movies from various services like Netflix and YouTube. They can also be controlled via smartphones.
Thus, the key thread that's taking the transition forward is digital entertainment. But, we wouldn't be surprised if OnePlus started selling dishwashers and Vivo took to washing machines. Not, since these devices have a lot to do with human behaviour and consumption.
So, does the 'smart' equity of smartphone brands make it easier for them to sell Smart TVs? And, is it more about lending the credibility of a strong brand in a certain segment to another segment? E-commerce platform Flipkart launched the Nokia Smart TV in India as part of a partnership with Nokia. The buzz is, Nokia just the lent the brand name to Flipkart and has little to do with the end-to-end production process.
Reports suggest, the Indian smart TV market is currently dominated by Xiaomi, followed by Samsung, LG and Sony. The 'smart' push for TVs could also be attributed to the growing conversations around smart homes and IoT. Analytics and consulting firm techArch values the Smart TV market at Rs 20,000 crore and is set to grow by 6.15 per cent in 2020.
Sandeep Budki, founder and editor, The Mobile Indian, says, "A consumer keeps a few things in mind while purchasing a product. This includes pricing, brand recall value and the company's reputation. Mobile phones are the fastest moving products in the electronics segment. A lot of handset brands started to extend into other areas, which has given rise to extensions like smartbands and smart watches."
Budki mentions that the other thing that has changed the equation is third party players like e-comm platforms Flipkart and Amazon offering brands the proposition of taking care of all the end-to-end manufacturing processes in exchange of using their brand name. Players like Flipkart have tied up with the likes of Motorola and Nokia, offering to take care of the manufacturing in lieu of using their name and marketing the products.
"Nokia had a rough 2018-19 and you don't expect the brand to invest in manufacturing TVs. But they still launched a TV. Nokia's TVs are made by a company called Skyworth which also manufactures for Flipkart. The e-commerce platform had launched its own electronics brand Marq sometime ago, but being new, this brand had little recall value. The cost of manufacturing both the Flipkart and Nokia TVs is the same, but Nokia has higher equity and can charge a premium price. Smartphone brands are trying to capitalise on their equity," Budki explains.
Former adman and present-day brand strategy consultant Prabhakar Mundkur says, "I remember my first mobile phone in 1994 was a Siemens. It was okay for durables manufacturers to produce mobile phones back then. Philips also had one. But mobile phones have progressed a long way since then. Over the last 10 years or so, they have replaced cameras, torches, calculators, computers, radios, and a host of other utilities. They have even replaced TV by becoming the dominant screen in our lives. I see my night watchman watch movies on his phone till his recharge runs out."
"I think the other big revolution is the OS. Mobile phone manufacturers are not just promising TVs. They are promising compatible operating systems by offering what they call Android TVs. Now let me take the help of Wiki, which defines Android TV as “Android TV is a version of the Android operating system designed for digital media players, set-top boxes, soundbars, and TVs and developed by Google.” In many ways, I see Android TVs as the beginning of the death of TV as we know it. Now, people have access to all the OTT platforms on their TVs. Cable is getting ready for a premature death in this new decade," he adds.