Most of the smartphone focus over the past year has been heavily focused on China, as both the world's most populous nation as well as recently becoming the largest smartphone in the world, dethroning the U.S. in 2012. Behind the headlines, the world's second most populous nation is now worth paying attention to for future smartphone growth: India.

Here are IDC's estimates of smartphone market share by country from last year.


2011 Market Share

2012 Market Share

2016 Projected Market Share

People's Republic of China












Source: Forbes.

As far as basic demographics go, here are some recent estimates to compare the two largest countries.





1.34 billion

1.21 billion

Urban population

47% of total (2010)

30% of total (2010)

GDP per capita (adjusting for PPP)



Population below poverty line



Source: CIA World Facebook. Estimates as of 2012 except where otherwise noted. PPP = purchasing power parity.

Indian consumers generate less GDP per capita relative to China, and more of its population is below the poverty line, while its real GDP growth rate is also lower. However, its real GDP growth rate of 5.4% is higher than the 2.2% rate for the mature U.S., so there's still opportunity there. On top of that, smartphones can be cheaper than other computing devices like PCs, and consumers are shifting discretionary spending patterns toward mobile devices.

All of these factors are why smartphone vendors need to target India in addition to the large U.S. and China markets.

Eyes on the prize
According to a recent Wall Street Journal report, that's exactly what Apple (NASDAQ:AAPL) is doing, "overhauling" its operations since the iPhone maker has historically had incredibly low Indian market share. Apple has faced numerous hurdles in the country; carriers do not subsidize smartphones and Apple relies on the subsidy model to maintain its average selling prices, while complex local regulations and distribution layers have always prevented Apple from opening its own retail stores.

Both of those factors are crippling to Apple's prospects in many ways. Sticker shock on an unsubsidized iPhone can be a powerful thing, and without Apple Stores the company can't control the buying and product education experiences that have contributed greatly to its success in other countries. Apple also has no direct online sales in the country due to the complexities, so it relies entirely on resellers and small franchisee-owned store-within-a-store shops.

Apple dramatically changed its distribution strategy in India late last year to expand its reach, and it seems like those efforts are starting to pay off as iPhone shipments have skyrocketed by three to four times in the past three months.

The WSJ quotes researcher Canalys as estimating that Apple shipped over 250,000 iPhones to India last quarter, which represented a 200% sequential increase. For the full year, Canalys thinks Apple shipped 460,000 iPhone units to India. Apple has also grown its ranks at its Indian subsidiary by 30% to 170 employees recently.

But don't forget Sammy
Archrival Samsung currently dominates the Indian smartphone market with a 40% share, towering above Apple's 5%. Recent data released by developer Animoca show that among Google (NASDAQ:GOOGL) Android devices, Samsung comprises all ten of the top spots, primarily with lower-end models like the Galaxy Y and Galaxy Fit. High-end flagships like the Galaxy S and Galaxy Note families combined were still 13.1% of Android devices.

To date, Apple has always occupied the high end, even with older models that cost five times as much as newer low-end Android devices. BlackBerry (NYSE:BB) is now targeting this market segment, recently launching its new Z10 in India for $800. The Canadian company has a similar 5% market share. Local reviews question the Z10's ability to do well at that price point, suggesting it would be more successful at mid-range price points.

Apple's only way to succeed in India will be to move downmarket. What were we saying about a low-cost iPhone?

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