Xiaomi faces increasing pressure from Huawei's online efforts with Honor, as well as Oppo and Vivo, whose marketing activities have been taking attention away from Xiaomi. "Sustained J-series shipments to its established offline distribution partners ensured that it stayed on top", the report said. Chinese companies comprising Xiaomi, Vivo, Oppo and Lenovo (including Motorola) had a share of 43 percent, down from 46 percent in the December 2016 (Q4) quarter.
The Chinese smartphone market as a whole continued to grow in Q1 this year, with shipments seeing a growth of 9% compared to the same period last year.
The research reveals that Huawei shipped almost 21 million units this quarter, after being second to Oppo for the last two quarters. In total, 114 million smartphones were shipped in China in the first quarter, according to Canalys.
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Yet another positive development was the preference for high-end smartphones, as reflected in the increase in the average selling price.
"Xiaomi's success in India is underscored by its online go-to-market strategy. Demonetization seems to have had no impact on it, as its target customer is young, Internet-enabled and primarily buys online", said Canalys Research Analyst Ishan Dutt. The mobile handset market grew by six per cent in the January-March 2017 quarter, with smartphones and feature phones contributing equal share.
In the Gartner report Lenovo and Karbonn Mobiles were the only brands to increase their vendor share in India which stood at 8.1% and 5.2% respectively in 2016. OPPO has an extremely high annual growth of 55%, however, despite that, Huawei managed to reach back to the top once again. Those three smartphone producers together accounted for half of all smartphones shipped in China during the first quarter. "One year on and all three vendors have dropped out of the top five, with their collective share falling to around 11 percent". Same time a year ago, Xiaomi was third but now it is just 5th in the market shipping just 9 million units, and they're even behind Apple and its iPhones. "...those that react quickly to the new regulations will benefit", it noted.