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BBRY Targets Low-end Indian Market

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Research In Motion Limited (BBRY) slashed its start-up BlackBerry service rates of INR899 ($16.8) for corporate users and INR399 ($7.45) for individuals. The rates were reduced to INR129 ($2.4) for both the users for a 1 GB monthly data plan.

Research In Motion’s Indian telecom partner Aircel, Idea Cellular and Vodafone Group Plc.’s (VOD) Indian unit will offer the new subscription plan to its customers. The service will be available across 15 telecom circles exclusive of metro cities and category A circles. Customers with BlackBerry 7-based handsets are eligible to subscribe to the new service plan.

By the end of fiscal 2012, Research In Motion sold 15.1 million smartphones in the second-largest populated country, India. Research In Motion's market share in India is a mere 7.5% in comparison with Samsung and Nokia Corp. (NOK), which hold 43.2% and 13.3%, respectively.

The Indian handset market is mainly dominated by low-priced feature phones. However, the trend seems to reverse as the smartphone market grew by 48% last year as compared with 16% growth in the feature phone market. In order to avail the opportunity, Research In Motion is considerably lowering its smartphone prices and reducing the entry-level service rates.

The Indian market is highly price-sensitive. In order to increase its penetration in the mobile crazy country as well as to counter intense competition against local handset makers like Micromax and Karbonn, which offer Google Inc.’s (GOOG) Android-based low-cost mobile phones, the company has rolled out such promotional pricing strategy.

Currently, Research In Motion carries a Zacks Rank #2 (Buy).

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