“OAO Mobile TeleSystems, the iPhone’s biggest wireless carrier in Russia, criticized Apple Inc. for not cutting the device’s $1,000-plus price in the country and being too strict about how it’s sold,” Sarah Frier reports for Bloomberg. “The phone’s cost makes it a hard sell in a market where rival models go for as little as $120, executives from the Moscow-based company said at an event yesterday in New York. Apple also requires that the carrier’s retail locations meet its standards, imposing additional burdens, MTS said. ‘They’re more in a dictatorship mode where they say, ‘This is what you have to do or you don’t get the iPhone,’’ Vasyl Latsanych, the Russian company’s vice president of marketing, said at the event. ‘Being arrogant with your partners in big markets doesn’t pay off.'”
“The remarks exposed a rift for Apple in one of the largest emerging mobile-phone markets and added to concern that the iPhone maker is charging too much in developing economies,” Frier reports. “Chief Executive Officer Tim Cook faced questions after last week’s earnings report over whether the iPhone’s pricing was going to limit growth overseas. He responded that Apple’s focus on product quality trumped other considerations. ‘I firmly believe that people in the emerging markets want great products like they do in developed markets,’ Cook said during the call on July 24. The goal ‘is to make the very best product, and that’s more important and overshadows all other things.'”
Frier reports, “Unlike in the U.S., Russian consumers typically don’t sign up for long-term mobile-phone contracts. So it’s less practical for carriers to subsidize the phone’s cost themselves the way AT&T Inc. and Verizon Wireless do… After making the remarks about Apple, MTS softened its criticism later in the day. ‘While we have differences with Apple, we have a constructive relationship,’ Joshua Tulgan, an MTS spokesman, said in a statement. ‘Smartphones like the iPhone are important to our customers and our economy and we want to get them into the hands of as many people as possible.'”
Read more in the full article here.
MacDailyNews Take: Come on, Latsanych has to at least understand the basics of the industry and the subsidized vs. prepaid markets, right?
[Thanks to MacDailyNews Readers “Sarah” and “cjpitt” for the heads up.]