Lenovo bets big on India, aims to take on Samsung

China's Lenovo Group Ltd on Thursday said it wanted to become a major player in India's 16-million smartphone market and expressed confidence that it could beat Samsung Electronics Co Ltd, the world's largest smartphone maker, in India and other emerging markets.

"Samsung is the greatest company in the world right now. We are confident we can compete with them. If we can beat them in China there is no reason why we cannot beat them in India," Yang Yuanqing, chairman and chief executive officer of Lenovo, told reporters.

Lenovo, the world's second largest personal computer (PC) maker, entered the smartphone market last year under its own brand across emerging markets.

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At present, South Korea's Samsung and Finland's Nokia Oyj dominate India's smartphone market with a combined 80 per cent share.

"From the next financial year, we have targeted to sell 1 million smartphones in the country (India). We have already sold 9 million phones in China in the last three months," Yang said, who was in Delhi with the management team.

The Chinese company, which launched smartphones, some of which are priced below Rs 10,000, in south India in November, has sold over 40,000 devices so far.

It will look for a 10 per cent market share in the next few years, said Milko Van Duijl, president Asia-Pacific and Latin America, Lenovo.

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Currently, smartphones are imported from China, but Milko did not rule out starting manufacturing in India later.

Asked about reports that Lenovo was considering acquiring Canadian smartphone maker BlackBerry (formerly Research In Motion), its chief financial officer Wong Wai Ming said: "We would do acquisitions which add value to our existing business. Acquisition in the PC plus (mobile space) offer more interest to us."

He refused to divulge further details.

Chairman Yang said the company's strategy was to defend its position in China, and attack rivals in other emerging markets, including India.

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He added the company would continue innovations in the consumer electronics space. "The notebook and the desktop PCs will not die. It will be redefined and the market will continue to grow. And Lenovo will be a pioneer in this innovation."

Asked about the battle between Samsung and Apple Inc on patent infringement, Yang said: "It's not right to copy at all. The purpose of intellectual property rights is not to copy, but to innovate."

Identifying the three key areas where the company would focus on, Yang said: "Smart connected devices would become lighter, and you would be able to talk and even gesture to them. The second key area would be cloud computing, which would help in information collaboration. And the third area would be security."

On Thursday Lenovo announced its entry into the rising smartphone market of India, in partnership with dual-technology carrier Reliance Communications (RCom).

The handset that works on both GSM and CDMA technology platform simultaneously will be priced below Rs 8,000. The China-made co-branded handset will be made available in market by March-end.

Lenovo, which ventured into the smartphone segment two years before, has so far focused on the Chinese market.

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"We have plans to launch six more co-branded smartphones and CDMA tablets in India within the next six months," said Gurdeep Singh, president & CEO (wireless business), RCom.

The handset will be bundled with RCom services, while consumers will be given the option to use both CDMA and GSM services simultaneously.

"The device has in-built capability to switch between CDMA and GSM networks during a call or a data session, if one of the networks loses the signal. This would benefit the consumers and reduce call drops," Singh said.

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While the handset will be locked for the CDMA network with RCom, the GSM would be kept open and consumers can avail service of any other operator if they wish to.

The device will be sold across 2,500 retail stores of Reliance and 1,000 company-owned stores of Lenovo.

"India's smart phone market is booming and predicted to grow even faster in the coming years. We expect CDMA/GSM to drive market expansion both in terms of volume and in terms of technology and service innovation. Our partnership with RCom offers Indian consumers more and better choices," said Liu Jun, Senior Vice President, Lenovo Group.

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During 2012, about 16 million smart phones were sold in India, and the market is projected to double in 2013. Currently, about 80 per cent of the market is dominated by Samsung and Nokia.

RCom will offer special data plans and voice tariff with the co-branded smart phone. The operator also has plans to offer "all share" data plans where customers can pool their data into one account and use up to six devices across smartphones and tablets.

Meanwhile, Singh said that RCom would lower focus on the "voice only" subscribers and would proactively migrate them to its GSM network. CDMA will be kept only for data users, he added.