It's Apple vs Samsung vs Google this Diwali

NEW DELHI: Smartphone heavyweights Samsung Electronics, Apple and Google are set to engage in a battle royale over the next few months to capture a larger share of premium phone users, with their latest models breathing new life into the high-end segment.

In the fray are South Korea's Samsung, which expanded its lead over Apple in January-August, followed at a distance by Taiwan's HTC. Sony, No. 3 in the segment last year, has dropped off the radar, data from Counterpoint Technology Market Research showed.

Following up on the launch of its flagship Galaxy S6 and Galaxy S6 edge in March, Samsung introduced Galaxy S6 edge+ in August and Galaxy Note 5 in September. Google has unveiled two devices -- LG Nexus 5X and Huawei Nexus 6P -- both premium smartphones, hitting the market just days before the iPhone 6S and iPhone6S Plus go on sale on Friday.

While their prices are different -- with Google's latest devices the lowest -- iPhones have aspirational quotient and Samsung has a head-start and models that have been critically acclaimed, said analysts. "The launches will ignite excitement in the segment," said Vishal Tripathi, research director at Gartner. "Premium smartphone is a critical part of phone makers' portfolio, including those that lead the market, because consumer demand to upgrade to the next new model is growing, although slowly, in India."

The premium phone entries are timed perfectly with the festive season, a quarter in which handset makers typically notch up their highest sales. India is among the fastest-growing smartphone markets in the world and is poised to outpace the US as the second-largest market, after China, by 2017. According to International Data Corporation, 26.5 million smartphones were shipped to India in the second quarter of 2015, up 44% from 18.4 million in the same period in 2014.

Growth in the country's smartphone market comes mainly from the affordable segment — priced between Rs 8,000 and Rs 15,000 — and the entry-level segment, which brings in the new smartphone users. Big-ticket introductions are set to reinvigorate the segment. Premium smartphone shipments fell 26% to 1.77 million units in 2014 from a year earlier and climbed back up to 1.97 million as of August this year, according to CyberMedia Research.

"This past year, it grew at about 41-42%, so the market is huge and getting bigger," said David Shapiro, Global Director of Chrome and Android Marketing at Google. "We have a stronger high-end portfolio till date with seven smartphones, including Galaxy S and Note series. This is our best step forward this year, which will be visible in our market dominance," said Asim Warsi, Samsung India's vice president for marketing (mobile and IT).

Apple didn't respond to emails seeking comment.

Google and Apple's new phones will be followed by the launch of Sony's Xperia Z5 on October 21 and by Microsoft's Lumia 950 and Lumia 950 XL. All these phones will be in premium segment.

The premium segment accounted for 3% of smartphone sales by volume in the first eight months of this year, up from 2% a year earlier. The number of premium devices sold this year till August more than doubled from a year ago. In terms of value, the segment's share widened to 23% of the overall smartphone market this year from 15% in January-August 2014.

"We estimate the new launches will expand the volume of the flagship segment," said Tarun Pathak, a senior analyst at Counterpoint Research.

Samsung and Apple have been taking turns at leading the market in the face of challengers such as China's Xiaomi, which offer comparable devices at lower prices. Samsung's S5 introduced in April last year was not well received by consumers as there was nothing substantial to differentiate it from the S4.

Apple led the segment with a 46% volume share in the January to August 2014 period, followed by Samsung with 34% and Sony with 12%. However, the tables turned in 2015.

Samsung expanded its share to 52% in January to August 2015 on the back of devices launched since February.

Apple lost some shine as its share dropped to 40% while HTC managed to claw up to 4%.

Analysts foresee little change in the market in the short to medium term.