Unbranded PCs still dominate in India
(InfoWorld) - Unbranded PCs assembled by small out-of-garage operations have about 45 percent share of India's PC market, according to an estimate by Intel.
These PCs, also known as " white boxes" will continue to have a significant share of PC sales in India, said Ravichandran R., Intel's director of sales for South Asia, in an interview last week.
Unbranded PC makers are particularly popular in small cities and towns, because of the low cost of their products, and as they are seen by customers as friendly neighborhood suppliers, who offer personalized support, he added.
India's PC market crossed 5 million units last year, posting 25 percent cent year-on-year growth in unit shipments, according to research firm IDC (India) in Gurgaon.
Unbranded PCs will not go away, but as prices of branded PCs come down, the share of unbranded PCs has been going down, said Kapil Dev Singh, country manager at IDC, on Monday. Most multinational PC brands may not find it profitable to operate in the low-cost segment addressed by unbranded PC makers, he added
Recognizing that unbranded PC makers were a key component of the Indian market, Intel introduced over a decade ago the Genuine Intel Dealer (GID) program which gave the unbranded PC assemblers access to Intel technology and certification, and a degree of legitimacy in the market.
Intel has since then introduced a three-tier Intel Channel Partner program which includes Premier partners that are value-added resellers, Associate partners that are volume vendors of unbranded PCs, and Registered partners which are smaller vendors. The company has about 9,000 of these partners that help address both urban and rural markets in India.
About four years ago, Intel tried to get these channel partners to also get into assembling and selling notebook PCs, but that strategy has not as yet been very successful, said Ravichandran. Demand for notebook PCs through this channel is still low as notebook PC customers are brand conscious, he said. As the users of notebook PCs are mobile, moving from city to city, they require multi-location support which unbranded PC vendors cannot offer, he added.
In the event, the unbranded PC vendors are re-selling branded notebook PCs from large Indian and multinational vendors.
As unbranded PC makers are not assembling notebooks, that keeps them out of a fast growing market, said IDC's Singh. The notebook PC market grew 104 percent by unit shipments last year, much faster than desktop growth at 15 percent, according to IDC. Shipments of notebook PCs were close to 1 million units.
A number of multinational notebook vendors have dropped prices on their entry-level notebooks, which has made them attractive even for some first time users, Ravichandran said. Besides offering mobility and flexibility, notebook PCs also offer battery backups which come in handy in small towns where there are frequent power outages, he added.
But notebook PC prices have not dropped as low as that of desktops, with some high-end desktop configurations available for less than the cost of entry-level notebook PCs. Enterprises have also been slower than consumers in adopting notebook PCs because of worries about security, Ravichandran said. As a result the share of notebook PCs in the total PC units shipped is about 20 percent, but that will grow, he added.
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