Headliner: Will Xiaomi prevail in Pakistan?

Headliner: Will Xiaomi prevail in Pakistan?

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With the advent of 3G and 4G cellular networks in Pakistan, the smartphone market in the country has seen tremendous growth in the last 2.5 years. In 2015, smartphone shipments to Pakistan increased by 123 percent according to the International Data Corporation (IDC).

A little late to the market boom, Xiaomi announced the launch of three new smartphones in Pakistan including the entry-level Redmi 4A and Mi Max.

Xiaomi has a knack for grabbing a decent chunk of any market it deems to enter, but Pakistan is a slightly different story.

As of February 2016, only 11 percent of Pakistanis owned smartphones and in a country where internet usage is still very uncommon, this comes as no surprise. Of those 11 percent, Qmobile commands a dominating 50 percent share of the Pakistani smartphone market and brands like Nokia and Samsung make up for most of the remaining numbers.

Xiaomi is no newbie to the international market but it doesn’t take much thinking to see that the battle for market supremacy in Pakistan will be a tough one for them.

Pakistan mobile market

The Price Game

Until recently, Nokia was the market leader in Pakistan, much like it was in the rest of the world before it succumbed to pressures from new and nimble smartphone operating systems. Thereafter, Android smartphones slowly crept up the ladder and began accumulating market share at an accelerating pace. But there was still one more hurdle to cross – smartphone cost.

In most developing nations, internet usage is directly proportional to per capita income. Case in point, Indonesia. With a per capita GDP of over $3,800, Indonesia’s smartphone penetration is nearly 25 percent. In other words, almost a quarter of the country’s population uses smartphones as opposed to 11 percent in Pakistan.

Global smartphone market

Despite these statistics, Pakistan is one of the fastest growing smartphone markets globally thanks to the increasing reach of 3G and 4G network providers like China Mobile’s Zong. The credit also goes to Chinese smartphone startups that have been able to provide the right mix of quality and cost for an emerging market like Pakistan.

The average selling price for cellphones in Pakistan is $45.

The smartphone penetration slowdown in developed nations like Australia and the United States also accounts for the rocketing growth seen in developing nations. First-world countries have essentially been saturated with smartphones and there simply aren’t any new people left to buy themselves a first smartphone.

As a result, competition is lightening and the focus is shifting to developing countries like Pakistan.

The emergence of several players in Pakistan’s smartphone scene has promoted healthy competition leading to a drop in smartphone prices.

Daraz.pk, one of the leading e-commerce portals in Pakistan saw a 50 percent drop in smartphone prices over two years. A premium smartphone in Pakistan today costs around PKR 30,000, down from PKR 61,000 in 2014. Interestingly, Daraz is the retail partner of choice for Xiaomi in the country.

It remains to be seen how well Xiaomi can tip-toe its way around the Pakistani market before being able to compete with major contenders like Vivo and Huawei. For now, Xiaomi can bask in the afterglow of a successful launch.

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  • Zero

    So, only the Redmi 4A would stand a chance…

    • Muhammad Yasir

      not really , people have ordered the Mi Max , over the 4A and RN4 !

      i credit the author for his extensive research and especially taking time to write this article , but you have to see beyond the paper to know the real picture. the people who are somewhat knowledgeable with regards to smartphones have been DYING to buy Xiaomi phones for some time now and are now ordering their preferred model at will !

      which is why , i have said this time and again that Xiaomi NEED to launch all their recent models in Pakistan if they want to see their popularity balloon !

      • Jh1

        Did you get one yet, Muhammad?

        • Muhammad Yasir

          nope 😀

          currently running a Galaxy Mega with CM13 , a phone i inherited from a sibling :p

          i’m thinking of waiting a while for xiaomi to release more models to get a better idea of their pricing strategy before making the plunge …

          but make no mistake , i am ELATED at their arrival ! you can’t believe how many people are DESPERATELY waiting to buy the Xiaomi Mi Mix here !

          • Jh1

            Sounds like a good plan. Glad that Xiaomi finally has a presence there. My Redmi 4 prime has been excellent, except for very average camera performance.

            • Wolvie

              I beg to differ as you have to think what kind of prices that you pay for it, than you will notice that Xiaomi camera quality is actually pretty satisfactory. I am quite happy with my redmi note 3 pro camera.

              Of course you cannot compare to flagship samsung galaxy S8 phone. it is just not fair to compare LOL.

              Xiaomi redmi note do not have the best camera in the market but hey i pay so cheaply and its camera is the most decent compare to other brands in the market with same pricing.

            • Muhammad Yasir

              price to performance ratio is brilliant

            • Jh1

              I’m not saying the redmi 4 prime isn’t a good phone, because overall I think it is excellent. However I do think there is room for improvement in the camera performance, even at the price point. Image quality is pretty comparable to my meizu m2 note, but lags far behind my meizu m5 note, zuk z2 and xiaomi mi4. All of those are currently available at a comparable price range to the redmi 4 prime. Again, I am very happy with the phone overall, and am a xiaomi fan, but there are some areas that could stand further focus.

          • Wolvie

            Mi Mix or Mi MAX ?

            Mi Mix is xiaomi high-end model and i don’t think the high price is justifiable. Not to mentioned that Mi Mix is highly FRAGILE. If they have butter finger like me then don’t ever think to buy Mi Mix.

            If you mentioned about Mi Max then it is more make sense.

            • Muhammad Yasir

              Mi Mix … they really love the bezeless screen !

  • Muzamil Sarfraz

    Not really there are a lot Samsung s series and iPhones in Pakistan, because Samsung nothing good at the budget price range people are forced from q mobile, a company that sells Chinese cellphone under there own name. Xiaomi have released MI Max around 230$ and the redmi 4a for 130$, redmi note 4 mediatek is soon to available at 200$ price. I believe prices here are a bit stiff compared to other markets I was looking to buy a good phone 🙁 but no MI series yet announced , moto has landed in Pakistan as well but I think Pakistan can be an easy take over for xiaomi if they take it seriously As it has a lot of users.

    • Muhammad Yasir

      OFFICIALLY , MI has introduced Redmi Note 4 SNAPDRAGON variant in Pakistan while resellers have the MTK variant in stock.

      i think the prices are fair , considered the criminally high taxes in the country !

      i hope Xiaomi can win some sort of subsidy favor from the govt to FURTHER cut prices but otherwise the prices are fine , i just hope more xiaomi phones are introduced asap