Symphony to start local assembly of handsets to produce 5-6 million sets per year from next month

[Black_cats]

12:00 AM, August 13, 2018 / LAST MODIFIED: 12:06 AM, August 13, 2018
Symphony to start local assembly of handsets next month

https://www.thedailystar.net/news/b...rt-local-assembly-handsets-next-month-1619998

Muhammad Zahidul Islam

All is set for Symphony to start assembling mobile handsets in Bangladesh as the leading vendor has already set up the plant in Ashulia.

The commercial assembling will begin next month with a plan to put together mid-range handsets, said a top executive of the company.

“After we got the licence, we have completed all of our preparations. Now the assembling will begin next month,” said Md Maksudur Rahman, senior director of Symphony Mobile, a sister concern of Edison Group.

The plant has the capacity to assemble 500,000 devices every month and is planning to assemble mostly feature phones and a good number of 3G-enabled smartphones.

“Our initial target is to set the standard and then we will go for 4G-enabled and other high-tech devices,” said Rahman.

He spoke on the sidelines of a co-branded handset launching programme with Grameenphone at the Pan Pacific Sonargaon hotel yesterday.

Symphony is putting in about Tk 100 crore for the venture in Ashulia, said a source of the company.

Edison Group completed establishing the plant in the first quarter of 2018 after receiving the licence from the Bangladesh Telecommunication Regulatory Commission. However, all the preparations related to official launching came to a halt after the government suddenly increased taxes of local assemblers.

Higher tax is a huge burden to the industry and preventing the market growth from accelerating, Rahman said, while addressing the programme.

For the first time, the mobile device industry posted a negative growth in the January-June period and this sent a negative signal, he added.

Rahman also shared the company's plan to export mobile handsets – a development that will make Bangladesh a device-exporting country.

Symphony, the market leader both in smartphone and feature phone segments in Bangladesh, also plans to set up its second assembly plant, which will be established in the Bangabandhu Hi-Tech City at Kaliakoir in Gazipur, the country's first hi-tech park.

It has signed an agreement with Summit Technopolis, a joint venture between local Summit Group and India's Infinity, the developers of the park. In 2017-18, the government took an initiative to inspire local firms to set up assembly plants to meet the demand of the fast-growing market.

Last year about 3.4 crore mobile handsets were imported through legal channels, of which 82 lakh were smartphones, according to the Bangladesh Mobile Phone Importers Association. In the first half of 2018, it stood at 1.55 crore units and 37.89 lakh units respectively.

Every year, the country spends more than Tk 10,000 crore for importing this huge volume of devices, said industry source.

So, once the local assembling starts full-fledged operations, a huge amount of foreign currencies will be saved, said industry people.

The BTRC also awarded licence to another local player Walton and global leader Samsung. Both companies are already assembling handsets.

 

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[Bilal9]

I think going by the video, Symphony plans to initially assemble Smartphone sets from imported components and sub-assemblies like in India and other countries. This will increase their market-share by sourcing and manufacturing cost reduction, which will be passed on to the consumer.

Manufacturing of components like AMOLED screens and pick-and-place operation of Surface Mount Devices on flex circuit boards by robots (as Walton does) still is far off for Symphony but hopefully not too far off. If Walton could pull it off, they certainly can. They could also source screens and circuit boards from Walton in the interim. OEM manufacturing for other local (even regional) brands under those names is also a great idea.

Symphony market share of 30 plus % (huge numbers in even Asian terms) will certainly help in indigenizing increasing share of locally manufactured parts and components. Compared to Symphony, Walton barely has 10% and Chinese brands have 30%.

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Chinese Smartphone Brands Now Have 29% Market Share in Bangladesh

DECEMBER 24, 2017
BY TARUN PATHAK

According to the latest research from Counterpoint’s Market Monitor program for Q3 2017 (July-September), the Bangladesh Handset Market grew 19% Y-o-Y and 1% sequentially. Flat sequential growth during the quarter was attributed to excess inventory in the market post EID festival and the impact of heavy rainfall across the country for almost two weeks.

Chinese brands continue to grow in Bangladesh and now capture 29% of the market, up from 13% a year ago.

As smartphone penetration in the country increases, local brands, which are losing market share to the Chinese brands, are positioning themselves as best-placed to tailor products to local needs and preferences. However, consumer uptake has been slow, especially after duties were increased in June 2017 and those interested in buying LTE phones waiting for LTE roll-out, now likely to happen during early 2018.

Chinese brands have been aggressively expanding in the Bangladesh smartphone market with low-cost offerings. Major Chinese brands like Huawei, iTel, Xiaomi and OPPO have already started to make their presence felt by grabbing market share from local brands. The expected launch of 4G services in January 2018 will further add to the advantage of the Chinese brands, as they offer budget 4G smartphones with good specs. Local brands like Symphony, Walton and Winmax will have to quickly adapt to the change in the market if they want to maintain share.

Exhibit 1: Bangladesh Smartphone Shipment by Broad Category Q3 2017

Market Summary:

• The Bangladesh mobile handset market grew 19% annually and 1% sequentially.
• Smartphone growth slowed during the quarter growing by just 3% annually.
• Smartphone shipments contributed to 24% of the total mobile phone shipments, signaling a slow but steady adoption of smartphones.
• Chinese brands have been growing aggressively.
• Symphony Mobile remained the number one handset player in Bangladesh with 26% market share. But its sales declined 24% annually and 19% sequentially owing to tough competition from players like iTel and Nokia.
• In the smartphones segment Symphony remained the number one smartphone brand with 30% market share. Its entry-level smartphones including V75 and V110 proved popular.
• Samsung was able to maintain its second position in the smartphone segment with 14% market share. Its sales nevertheless declined 3% compared to Q3 2016. Its Galaxy J2 model was the number one smartphone sold in the country during the quarter thanks to strong promotions.
• Huawei clinched the third spot in the smartphone segment with 8.5% market share in the quarter. Its low-cost Y series smartphones helped the brand stay relevant to Bangladeshi consumers.
• Walton was the only other Bangladesh brand to be featured in the top five smartphone brands list, achieving 8.3% market share. In recent quarters Walton has shifted its focus to feature phones.
• iTel, another Chinese brand, has been aggressively expanding its presence in Bangladesh smartphone market with its low cost mobile phone offerings. The brand at number five captured 6.9% share of the Bangladesh smartphone market.
• During the quarter Grameenphone also launched entry level devices with Symphony and iTel to target feature phone upgraders.

Exhibit 2: Bangladesh Mobile Phone and Smartphone Shipments

Source: Counterpoint Research Market Monitor 3Q 2017 Report

The comprehensive and in-depth 3Q 2017 Bangladesh Market Monitor is available for subscribing clients. Please feel free to reach out to us at press@counterpointresearch.com for further questions regarding our in-depth latest research, insights or press enquiries.

The Market Monitor research is based on sell-in (shipments) estimates based on vendor’s IR results, vendor polling triangulated with sell-through (sales), supply chain checks and secondary research.

Local brands dominate smartphone market
Ishtiaq Husain

• Published at 12:09 am July 23rd, 2017

Bangladesh has seen a rapid growth in mobile handset market, specially in smartphone segment, since 2013, with local brands dominating the market, while the international ones are striving to gain momentum with their aggressive marketing strategies.

At present, the country is a Tk. 8,500-core market of some three crore mobile handsets comprised of local and international brands vying with each other. Of the total mobile phones, only 30% are smartphones and the rest are basic phones, which are priced below Tk2,000. Since 2008, local mobile handset brands had the lion’s share of the market with its lost-cost and mid-range basic products.

During the period between 2008 and 2012, international brands were losing their business to local brands, Symphony and Walton, which gathered momentum with their over 50% market share. The local brands served customers with low-cost smartphones priced at between Tk3,000 and Tk6,000. We have some limitations about skilled manpower and technology. It will take time to achieve that skill In recent years, particularly over the last two years, most international brands made a comeback with their quality products, strong Research and Development (R&D) strategy and after-sale services.

There are hardly any districts where international brands have not opened up their showrooms to reach out their products to smartphone users. According to the Technology Market Research Firm, Counterpoint, Huawei that entered the top five smartphone brands topped the list in Q1 of 2016 and continues to perform well in the segment, moving up into top three spots in Q3 of the same year. The growth was mainly driven by its affordable smartphones.

Samsung has slipped to become the third largest mobile phone brand in Bangladesh, still holding the second position in the fast-growing smartphone market with a 15% market share. Indian brand LAVA that set foot in the Bangladesh market in 2013 remains strong within top five smartphone brands in the country with 8% market share presently.

Unlike LAVA, Micromax India which is struggling in its home market continues to lose its market share in Bangladesh as well, and is now out of the top 10 mobile phone brands listed in Q3 last year.

Symphony leads by a big margin in both overall mobile phone and the fast-growing smartphone sub-segment with 14% market share. An affordable offer, effective localisation of software and services, expansive distribution and strong connection with local users drove the Symphony’s rapid. According to Symphony, currently, it holds 38% market share.

The fourth largest mobile phone player in Bangladesh, Walton, is ranked with top five in both feature as well as smartphone segments.

Photo: Dhaka Tribune

Given the situation, Ashraful Haque, director (marketing), Symphony, said the local brand would be able to retain its market share using new strategy. Moreover, the government new tax policy on imported spare parts will be congenial to their business. In the last budget of Fiscal Year 2016-17, the government has reduced tax over 15% on imported spare parts which would encourage local brands to assemble their mobile handsets in the country.

At present, around 30% people use smartphones. The ratio will reach 35% by the end of this year and 60% by 2020.

According to users, when it comes to quality, local brands fail to compete with the international brands, and to survive in the market situation, they got to produce quality products. Rezwanul Hoque, CEO, Transsion Bangladesh Limited, a Chinese mobile handset company, said the main weakness of local brand is they don’t have any Research and Development, one of the most important elements in manufacturing mobile handset. Transsion invests 6% of its total revenue earnings in R&D. He said Bangladesh has huge potential in mobile handset market.

To meet only 30% demand, some 82 lakh smartphones were imported in the last one year. If the ratio of smartphone use rises nearly 70%, the market would be increased more than twice.

Counterpoint Senior Analyst SuJeong Lim noted that “Although Bangladesh’s mobile phone market is driven by feature phones, smartphones’ share is also growing every quarter.” Of the total mobile phones, smartphone’s share is estimated to rise to almost 50% from 28% by the end of 2017, he commented.



The rise of smartphone users is fuelled by the launch of affordable 3G devices. It is mainly driven by local brands such as Symphony and Walton. Global brands Samsung with its J series along with Huawei and Oppo are pushing up the 4G LTE-enabled smartphones, the next battleground for differentiation in Bangladesh smartphone segment in 2017.

“LTE capable smartphones now contribute to nearly one on four smartphones shipped in Bangladesh,” Counterpoint Research Analyst Pavel Naiya, said, adding that Bangladesh market is mainly dominated by local players with a combined share of two-thirds of the total mobile phone market. Symphony Mobile remains the single largest mobile phone brand followed by Winmax mobile and others. Smaller Chinese brands continue to lose market share to Oppo and Xiaomi that have entered the smartphone market while local players are upping the ante with low-cost smartphones to sustain their market share, according to the research.

Uday Hakim, senior operative director, Walton, said: “No doubt, international brands are the big threat for us. At this moment, we need a friendly policy that will help us compete with international brands, or else, it would be tough to survive in this market.” Industry insiders said local brands pay 15% vat on supplying level and 35% corporate tax, which they termed a huge risk factor.

Uday added that Vietnamese mobile brands have a huge dominance in the world after China as its government took some supportive policies for local mobile companies. “If the government provides a 20 to 30-year tax holiday for local companies as Vietnam and India do, we will be able to produce cheapest handsets in the world.”

At present, there are 120 million mobile phone subscribers in the country. Of them, 63 million subscribe to mobile data plan of different sorts. The report pointed to the fact that although 10% of overall mobile phone subscribers got cut in 2016 due to biometric registration, mobile internet saw a 24% rise in subscriber’s number.

Handset importers of the country are eyeing a 25% growth in total sales of all kinds in 2017, said Bangladesh Mobile Phone Importers Association (BMPIA) president Ruhul Alam Al Mahbub. He said in Bangladesh customers become interested in buying brand handsets as their buying capacity has increased. “We have some limitations about skilled manpower and technology. It will take time to achieve that skill,” said Symphony Director (Marketing) Ashraful Haque.

In the country, over 40% population are connected to internet and there is a huge opportunity for the handset players to tap the first time users by offering affordable, yet quality smartphones.

 

[Bilal9]

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