IDC: ~350M people in India still use a feature phone, and 50% of them have a model that costs less than $18; the ASP of a smartphone is $255, up 54% from 2020
Context & Ripple Effects
India’s handset market has long had a split entry tier: feature-phone shipments doubled while smartphones were flat in early 2018, and $25 smart feature phones brought first-time users online in 2019. IDC’s new figures show that the low-cost end remains substantial even as smartphone pricing has moved higher.
That divide matters because later coverage points to a smartphone market increasingly shaped by higher-priced devices: Apple’s share reached a record level amid flat overall smartphone shipments. The remaining feature-phone base is therefore a material constraint on treating smartphone demand as a single market.
First-order effects
- The reported $255 smartphone ASP versus a feature-phone base concentrated below $18 makes the affordability gap explicit for hundreds of millions of users.
- Handset makers and distributors must serve two sharply different demand pools: ultra-low-cost basic phones and a smartphone market with a much higher average price point.
Second-order effects
- Brands seeking new smartphone users will face pressure to make entry devices and financing more accessible, while feature phones and smart-feature-phone formats retain a role at the lowest price points.
- A higher smartphone ASP can lift the importance of premium sales for vendors, but it also leaves unit growth more exposed to price increases; later reporting found broad smartphone price hikes weighing on sales.
Third-order effects
- If the gap persists, India’s handset market is likely to remain structurally segmented rather than following a simple, uniform migration from feature phones to smartphones.
- The conversion of feature-phone users becomes a question of affordable device access as much as product availability, with lower-cost connected-phone categories potentially acting as an intermediate tier.
The trend: India’s mobile-device market is bifurcating between premiumizing smartphones and a durable ultra-low-cost feature-phone base.