Indians, Spurred By Adoption Of Low-Cost Feature-Phones, Download 2 Billion Apps From Nokia Store

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The recent launch of cheap Nokia devices has stimulated a growing appetite for apps and games on the subcontinent, where the majority of the population don’t use mobile Internet or credit cards. Nokia has been the benefactor of this popularity and recently announced 2 billion apps downloaded from its own Indian App Store — a surprising number especially considering most of the handsets would be considered “dumbphones” in the West.

Half of these were done by owners of feature phones built on the S40 platform and its touch-based Asha OS — which will power its upcoming $99 501 “smartphone”. According to spokesperson Simran Sethi, 50 percent of these downloads occurred in the last year.

Sethi didn’t break out the percentage of purchased apps (action games were the most popular category) but said that there was increased buying behaviour ever since Nokia struck a deal with the country’s four biggest operators — Airtel, Vodafone, Idea, and Reliance, representing 70 percent of the country’s subscribers — allowing users to pay for downloads with phone credit. This overcomes a huge economic barrier, as most Indian consumers don’t own credit cards, or are afraid to use these online. He didn’t disclose the revenue-sharing agreement, but sources have previously indicated that operators take as much as 70 percent.

These downloads don’t include those done on the Lumia, whose apps are hosted on the Windows Phone store.

In line with its stated goal of connecting the next billion consumers, Nokia’s cheap devices have helped introduce apps to a new generation of users whose previous mobile experience was limited to calls and texts.

While this trend will receive another boost by the highly anticipated launch of the cheap, touch-enabled 501 feature phone — which has 48 days standby and comes pre-installed with Facebook and other popular apps — it won’t necessarily translate to long-term success.

The news is “good and bad” for Nokia, according to Delhi-based Forrester analyst Katyayan Gupta, who said that when these app-savvy users look to upgrade to a smartphone — where manufacturer’s enjoy the highest margins — they won’t necessarily pick a Lumia.

India recently grew to become the world’s third-largest smartphone market; however, this was primarily being driven by local Android OEMs, such as Micromax, Karbonn and Spice, who offer products in the $100 to $200 price range favoured by the status-conscious, frugal Indian consumer. A recent report by Strategic Analytics didn’t mention Nokia in India’s top smartphone manufacturers.

“The reasons that consumers buy smartphones is more word of mouth, more the type of applications, and, most importantly, what is my group doing,” Forrester’s Gupta said. “This was the reason that everyone owned a BlackBerry 700 series, because they needed BlackBerryMessenger to communicate with all their friends.”

“Now, people everywhere have an Android phone, which is where I would see the biggest challenge for Nokia.”