Indians flaunt 4-year-old iPhones as Apple’s India strategy starts to pay off

“Apple Inc., which has struggled in emerging markets because of the price of its new iPhones, has devised a strategy for India that’s starting to pay off: It’s pushing older models that offer cachet at affordable prices,” Bianca Vázquez Toness reports for Bloomberg. “The iPhone 4, which was released in the U.S. in June 2010, is still available. So is the iPhone 4s that went on sale in October 2011.”

“‘You flaunt an iPhone, but you don’t flaunt an Android,’ said Punit Mathur, a 42-year-old vice president of a digital media company who switched to a new iPhone 4s from a Nexus 4,” Toness reports. “An iPhone 5s that would cost 53,500 rupees ($874) is too expensive, ‘but the 4s is still an upgrade,’ he said.”

“‘Once Apple has fully proven this model in India, you’re going to see them roll it out to other markets,’ said Ken Hyers, an analyst with Strategy Analytics in North Carolina. ‘Particularly Brazil, Russia, Indonesia, the other large emerging markets where they want to gain market share,'” Toness reports. “Apple’s approach in India has helped it build traction in a country where 225 million smartphones will be sold this year, said Brad Rees, chief executive officer of London-based Mediacells, a marketing company. Apple, the fifth-largest vendor in India, more than doubled sales there in the first quarter to 325,000 iPhones from a year earlier, according to researcher Canalys.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “BillD” for the heads up.]

23 Comments

    1. Yes, in something known as “the future”, Apple will cycle their devices so the iPhone 6 is the flagship, the iPhone 5S is second tiere, the iPhone 5C will probably be 3rd tiere adn the iPhone 4S is fourth.

      They may even rework the 5S like they did for the iPhone5 -> 5C…

  1. The iPhone 4S has a dual-core A5, and it is still being sold in ALL markets as the lowest cost iPhone choice. The lowest cost iPad models also still use the A5.

    The iPhone 4S model would be a good choice to “keep around” for these markets beyond the current model year, as a lower entry point. It will be able to run the latest iOS version for probably two more years. It is a good-looking iPhone that does not look “dated.” The idea would be to keep the oldest iPhone design in production for one extra year (a total of four), for these markets.

    1. You seem to forget that Apple wants developers to write their apps for the current OS, which is 64 bit. The sooner Apple sunsets 32-bit hardware, the better it will be for everyone.

      1. I think Apple would rather sell an iPhone. You seem to forget that Apple makes money by selling iPhones (and other hardware), not by transitioning software more quickly to 64-bit. iOS developers already have the luxury of the most “non-fragmented” major platform in all of computing.

        1. Excellent point. Apple should be able to handle various versions of the OS at the same time. Developers, too. Hell, they do it in the Android world, albeit not very well. But Apple should be able to do it much better than Android, simultaneously.

          –Me2sense.

          1. Do they really (handle different versions) of the OS in the Android world, or is Android so fragmented that there’s little in the way of choice?

            I suspect that it’s the latter and if Android is any indication, it’s not a place where Apple wants to be. And could you also clarify about iOS being able to run different versions on older phones (if that’s what you meant) because technical requirements change, so it’s perfectly logical that older devices can’t–for example–run iOS 8 (or even iOS7 in some instances).

            And even devices that can, such as my iPad 2, runs iOS 7 ( and I assume 8) but some functionality is lost, which is what happens when older processors and hardware had to handle a new OS.

            1. My point is older hardware and older processors should be able to retain an older OS optimized for that device for at least ten years.

              Not a forced upgrade path to hobble performance and blame it on old tech. Which leads directly to the hidden agenda to buy more and new every year.

              Unacceptable! Especially when you consider the lifespan of industrial design hardware.

              –Me2sense

            2. Why 10 years? that’s absolutely an insane amount of time.

              Honestly, can you find me one mainstream phone maker that makes their phones updatable for that long?

              And besides, just because an iOS phone is not updatable doesn’t mean that the phone self destructs, it just means that there are no long updates.

              If you have an older phone, use it, but I think that your expectations are remarkably unrealistic, and not only for Apple, but for anyone.

              Prove me wrong. Show me one mainstream (or not) phone maker that supports a phone for ten years. Just one.

      2. Yes, of course they do.
        But you seem to be ignoring the fact that the App Store has tens, hundreds of thousands of apps that will run perfectly well on an iPhone 4/4S.

  2. There are price-sensitive consumers even in the USA, not to mention entire price-sensitive markets/countries. Why deny them a decent, affordable alternative to Android? In due course, these customers will upgrade to the (future) best-cost iPhone, so the strategy will produce a virtuous cycle of iPhone upgrades, albeit for the older (but still excellent) models. These older products may be all these customers want, or can afford. And there should be good money in it for Apple, too, since these older models are presumably low-cost to produce. Most importantly, it is good karma. This is how Apple will make a — bigger — ripple in the universe.

    1. Apple is not “denying” anyone. Apple already keeps each iPhone (technical) design in production for a full THREE years. iPhone 4S is still sold as new in ALL markets, and it it is approaching the end of its third year. iPhone 5C is technically an iPhone 5 in plastic; it will be in its third year with the next iPhone line-up.

      In some markets, Apple can just keep this same practice but extend each iPhone technical design life to FOUR years. As you say, the older design is still more than adequate for most smartphone users. I just bought an 32GB iPhone 3GS (used in really excellent condition), and I think it’s great.

      1. I had an old 1st gen iPhone sitting around in a drawer. Recently decided to see how good it worked. Bought a SIM card from an MVNO on a basic Pay-As-You-Go basis (AirVoice Wireless; they use the AT&T network). Paid $10 for service, which lapsed in 3 months if unused — that is $3.33 per month for basic phone, text, and cellular data service, as needed. And if you use it, you can just buy more minutes. Easy-peasy. I lent the phone to my daughter to use while apartment-hunting in the big city when she returned from Europe, until she bought her own new iPhone & service. Anyway, I thought the 1st gen iPhone and basic cellular service worked adequately.

        A lot of people need just a basic mobile phone for telephone calls. Text messaging is nice, too. Email capability is a bonus. And though the old phone had a relatively slow chip, it nevertheless functioned adequately for basic web browsing, too, particularly on Wi-Fi (rather than via cellular data service). Yes, it is slow. But it works. My old 1st gen iPhone worked surprisingly well for basic functionality. Incidentally, there were times I confused my old iPhone for my newer iPhone (3GS); so it still has the essential form factor everyone associates with iPhones.

        This experiment worked like a charm for a few weeks, then the original battery stopped holding a charge. It cost me $5 to buy a new (DIY) replacement battery online, whose leads had to be soldered into the iPhone. (Or you could pay more to have them do it for you.) The new battery works fine. I plan to give the iPhone to someone I know who is working-poor and still uses an old Motorola. It will be a step up.

        Basically, for the $5 price of a replacement battery, people can still use even the 1st generation iPhone, with inexpensive cellular service from an MVNO. A lot of people may be paying more money for a phone device and cellular service than they need. Or are using an obsolete device …and _still_ paying more for phone service than they might need. Some people just need basic functionality. Anything they save should go to their living expenses or savings for education or retirement.

        I do believe many older iPhones still have a useful life, and can serve an important role in helping many people who otherwise would not be able to buy a good, inexpensive, and relatively secure telecoms solution. I also wish someone would do a “life-cycle” analysis comparing Apple iPhones and all the other phones out there. I would find it hard to believe if the Apple iPhones did not have a huge advantage in their “green” credentials due to their very long useful life.

        Apple does not need to introduce a new “low cost” iPhone as many analysts have urged. But it is very socially responsible for Apple to offer its older, less expensive iPhones to the many folks who do not want, or cannot afford, to pay top dollar for the latest-and-greatest iPhone and accompanying high-priced phone service from a carrier.

        1. That’s actually how I use my “new” iPhone 3GS, with a low-cost pre-paid plan (AT&T GoPhone). My previous iPhone was the original 1st, also bought used, and used the same way. And I also replaced its battery.

          Note to DIY’ers, it is safer to use the existing battery wires (leads). Disconnect (unsolder) old battery from its wires (at the battery). Remove (unsolder) the leads on new battery, and solder the existing wires to the new battery. This keeps the heat and soldering away from sensitive iPhone components. If you mess up, you only ruin the $5 battery, not the iPhone.

  3. This story distills to this: In developed markets, Apple offers three generations of iPhone: current, last year’s and two years old. In India, they add one more, as it is more affordable. If this continues, it would mean that this September, Indians will have 4s as their cheapest iPhone choice (costing the same as iPhone 4 was today); next year, that place will be taken by 5c, year after that 5s, and so on.

    Much like those who upgrade here to the latest and best as soon as it comes out, Indians (and others form BRIC) will get their chance to follow the upgrade path at same annual cost (until they graduate into the next higher model category).

  4. If Apple is ever going to penetrate foreign markets, they must has a low-cost phone compared to what we rich Americans can afford. This trickling down the 5s is nonsense.

    I didn’t fully understand this gulf between the US and the 3rd world until I went to Thailand. There is, for all practicality no middle class to afford such expensive gizmos. In Bangkok you’ll see iPhones on the Skytrain, but once out of the city, you’ll never see one, only in the hands of a Western tourist. It’s all ancient Nokias with tiny B&W screens with prepay minutes from the “Sewen.”

    A construction worker makes $7 per day doing back-breaking work in the hot sun. A typical monthly working class wage is $800/month, so imagine how long it would take to save up for a silly phone after paying for rent, the scooter payment and food and shoes for the kids.

    They put into law that the daily minimum wage shall be $10 per day and the reaction was to reduce work forces because factories couldn’t afford such high wages.

    They don’t have $200 contract phones. They have to pay the crazy high full fare price of $750 + import tariffs that even Americans won’t pay. When I paid $750 for an unlocked 32GB Phone here from T-Mobile last year because of travel and needing to drop in numerous SIMs for different countries, my friends couldn’t believe their ears. What a splurge!

    When you see an iPhone on the street outside of a major financial city center, it is a major flaunting of wealth. Don’t be surprised if you get mugged by flashing your iPhone.

  5. I live in Argentina. 4S 8Gb free (no contract) around u$s 1000 in major retailers, not very cheap. A 5S 16Gb around u$s 1500 (mercadolibre.com.ar). NortthAmericans are really lucky. I can’t afford such an expensive phone, so I have an iPod 5 and an android LG1.

    1. Us Americans are very lucky. So lucky, many of us forget how lucky we are. I am a school bus driver for a small district and cannot afford an iphone yet either. I haven’t got an ipod or pad, although I want one badly! My computer is the oldest mac mini released in 2005, and I hope to replace it next year. I own a cheap Blu unlocked phone I paid $76 for and my service is through a cheap mvno Ultra that I pay $19 a month on. My truck is old, my clothes from thrift stores, and I don’t eat anything fancy. I’m not complaining, just thanking you for reminding me how lucky I am. I see others around me who are seriously less fortunate.

      1. You can have a nice iPhone for less that that “cheap” phone you use, if you get one used. Look on eBay. I recently bought a 32GB iPhone 3GS for $80 total cost. The same seller has 8GB models for less

        http://www.ebay.com/itm/U-Apple-iPhone-3GS-8GB-Black-FACTORY-UNLOCKED-Smartphone-C-/360810145746

        The one I got is in unbelievably pristine condition. It came in a nice new black box, with a protective (peel off) film on the screen side, with new (third-party) charger and docking cable. This seller seems to be topnotch, and has A LOT of old iPhones to sell. Maybe he gets them from Apple’s trade-in program… 🙂

        An iPhone 3GS runs up to iOS 6.x; there are many apps that are for iOS 7 and later. However, if you look beyond the “featured” sections of the App Store (which are the newest apps), there are MANY apps that work fine with an iPhone 3GS. And some apps that say iOS 7 required offer you an older version that does work. If the “mvno Ultra” service is GSM (uses a SIM card), it should work with an iPhone 3GS.

        1. Thanks Ken. I’ve been afraid to go down the used iPhone path due to the whole thing about some being sold locked to the previous user. Sounds like this seller may be someone I will consider once I get back to school and earning some money! It’s been a long summer of fun and working in a motorcycle garage to keep the lights on. Ultra is a tmobile mvno, so it is gsm. Not sure about the various models that are compatible or not, but I have plenty of time to do my homework. I really want to save up for a nice mac mini in 2015 though.(but I will be save a link to that seller.)

          1. Thanks for mentioning “locked” iPhones. iPhones are NOT locked to the previous user; any legitimate seller would do a “restore” on the iPhone before selling it used, to wipe the previous user’s data and settings. However, they may be locked (tied) to a particular wireless network. “Unlocked” iPhones should be usable on any supported wireless network.

            NOTE: Unlocking is not the same thing as “jail-breaking,” which is making an iPhone accept software that does not come from Apple or Apple’s App Store.

            The one I got from that particular seller is unlocked, although it is being used on AT&T’s network (with a GoPhone plan), so it may not matter. It did not immediately work with my old SIM card; I got that SIM card so long ago that I needed a new one that works with 3G networks. My previous phone was an original (1st gen) iPhone, which is 2G. The guy at the AT&T Store, who gave me the new SIM card, told me my old iPhone should not even be working on their network, because “2G phones are no longer supported” (but it worked fine).

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.