HMD Global, the maker of Nokia-branded phones, according to ET, plans to make India its future export hub. Recently it has raised $230 million from investors like Nokia Technologies, Google, and Qualcomm, out of which a large part of it is planned to invest the country.
India has the potential to become the world’s largest smartphone market in the coming years and brands do know that. 5G is an exciting thing coming in a few years, so 5G smartphones will also get a huge demand in the coming days.
So, HMD Global plans to work with its contractor manufacturers Qualcomm, and Google to help bring low-cost 4G and affordable 5G phones in the near future. Also, do keep in mind that Nokia manufactures it’s smartphones in India and is one of the few non-Chinese smartphone brands in India.
Florian Seiche, CEO, HMD Global talked to ETTelecom regarding this and he answered a lot of questions. Some of the important things he cited about the India’s smartphone market:
What does the fund-raising mean for India?
What that (fund-rasing) really enables us to do is to now focus on some of our key growth initiatives going forward. One of them is especially for the European and the US market, we want to focus on bringing the 5G transition that is not just limited to the top end portfolio, but to make the transition to the 5G technology more affordable.
The second one is we want to double down our efforts in software and services. We’ve already earlier this year, made a small investment in Finland in a software security center that we’ve opened and that’s playing a key role in our software quality management and we will further invest in other software areas like imaging. Earlier, we launched our first data connectivity service as a pilot, global roaming service HMD Connect at the beginning of the year. And we see this area as a great opportunity for us going forward to offer consumers directly the ability to connect their devices, right when they buy them from us or our partners.
And then the third pillar is the selected key geographies where we see unique opportunity and India for sure is key on that list. So, on that list is India but also Africa, and Brazil, a market that we have launched just this year, and also the US market where we have started our carrier collaboration last year. And I can say, for India, specifically that I’m excited about, I see a renewed optimism in India with the efforts to strengthen the local Indian smartphone ecosystem.
You also talked about the focus on the local ecosystem. What steps are you taking to deepen your manufacturing capabilities in the market? Are you looking at making India as one of your exports hub globally?
First of all, on the feature phones, as you know, we’ve already been producing India for a long time with our partnership with Foxconn. So there we have a very solid foothold in India. And for smartphones, as you said rightly, we are at the moment in deep discussions with local manufacturing partners, with the government, but also even with local possible component partners. So, we are very excited to see those possibilities become real in the next couple of months. And once we have that established, then obviously, as a future step, we could also envision India to be an export hub for us. However, now the first focus is definitely to strengthen that local supply chain set up to serve the Indian market and those opportunities that we can grow there locally.
Can you give us an idea of how much of value addition for Nokia phones is done locally in India?
All our phones are actually manufactured in India already today. But what we would like to do going forward is to even deepen that, especially for the smartphones by working deeper, with fewer local Indian partners who then can also on-board local key component players.
Are you also asking your global supply chain partners to set up their operations to support your India operations?
Yes, this has already led to this setup we already have in place today. And our vision is that going forward for the Nokia smartphones, we could have maybe one or two bigger local partnerships in place.
Could you give us an idea about your pricing strategies?
As of today, our core lineup is between $100-$250. So actually, I think that for India covers quite a broad part of the market. So that’s definitely our core focus area.
In India, we now have a number of 5G phones already commercially available. Will HMD be playing a key role in bringing 5G phone prices further down?
We want to work together with Qualcomm but also with the carriers. I think for the user, it’s important also to have the coverage available so that they can enjoy, actually the true benefits of the technology.
Will you launch commercial 5G phones at affordable price points?
Nothing I can announce today, but I can share with you that it’s definitely a key priority we’re working on today.
Read the full interview here. Obviously, as Florian Seiche said, the brand will obviously look forward to the country especially when the anti-Chinese sentiment has increased sales for Nokia and other non-Chinese brand smartphones. Also, the Indian Govt has laid the PLI scheme to help boost local manufacturing and make India one of the top smartphone exporters in the next 5 years. Then, in 2021, 5G will again play a vital role and brands will think to profit from this to focus on the market with 1.3 billion people.
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