“After spending $1 billion to buy long-term access to the Chinese consumer market, Apple must be wondering how much a retail presence in India will cost,” Tim Culpan writes for Blooomberg.
“The U.S. company wants to open its own stores in the country. Doing so would allow Apple to better promote iPhones, and control the sales and service experience amid a flood of cheaper alternatives. Indian law requires such single-brand stores to procure at least 30 percent of a product’s components locally,” Culpan writes. “Companies with cutting-edge technology can get a waiver, but India’s Foreign Investment Promotion Board has decided that Apple doesn’t meet that benchmark, Bloomberg‘s Siddhartha Singh and Saritha Rai reported Tuesday.”
“The size of the check Apple needs to write would therefore, in theory, be equal to the amount of money India expects to keep locally,” Culpan writes. “If Finance Minister Arun Jaitley decides to uphold the ban, Apple has one final option. By signing a franchise agreement with a local Indian retailer, the company could get its shop fronts without the foreign investment. The business model would look a lot like McDonald’s…”
Read more in the full article here.
MacDailyNews Take: The check has already been written, so let’s see what happens as that fact percolates throughout the India government as India considers Apple Retail Stores.
SEE ALSO:
Apple hits setback in push to open retail stores in India – May 24, 2016
Apple’s U-turn in India: From arrogance to servility – May 23, 2016
Apple finds potential new factory hub – in India – May 23, 2016
Apple’s Tim Cook samples Bollywood, cricket, in bid to woo India – May 21, 2016
India shows Apple CEO Cook the love it’s yet to give the pricey iPhone – May 20, 2016
Apple CEO Cook: ‘We are in India for the next thousand years’ – May 20, 2016
Watch Apple CEO Tim Cook at his first cricket game in India – May 19, 2016
Apple opens Maps development office in Hyderabad, India – May 19, 2016
Apple CEO Cook debuts in India – May 18, 2016
Apple to open first-of-its-kind iOS App Design and Development Accelerator in India – May 18, 2016
Tim Cook visits India: Apple to expand its Indian software development center, build local start-up accelerator program – May 17, 2016
Apple Retail Stores to open in India by end of next year – May 16, 2016
iPhone sales surge 56% in India as Apple eats into Samsung’s high-end share – May 8, 2016
Apple deprivileged as India bows to Washington D.C. consensus on mobile phone import tariffs – May 7, 2016
India rejects Apple’s plan to import and sell refurbished iPhones – May 3, 2016
Indian government panel paves way for wholly-owned Apple retail stores in India – April 28, 2016
Hasn’t India had to suffer with Windows long enough? India should be begging Apple to come in, not vice-versa.
Alas, Microsoft probably got a stranglehold on that country by doing what they always do, dumping cheap goods and buying thier way in, so now Indian politicians think that’s ‘just how business is done’.
Sounds like a shakedown to me / cash grab for the country – it is a shame that every man-woman-child in the world knows that Apple has a ton of cash – and everyone has their hand out.
While any given situation is always more complicated, their overall requirement that access to their market requires investment in local jobs and tech growth is just good negotiating on India’s part, as long as they get away with it. (It would be the US Governments job to stop protectionism like that with reciprocal actions.)
But I am sure Apple will figure out a good solution for India now that it has become a top priority.
The Indian market is such a clusterfsck.
ever notice that everyone in power hostile to Apple has an iPhone for their personal use:
like Indian PM Modi (pix below)
Donald Trump
Eric Schmidt
etc
I guess the ‘other phone’ are for the ‘lower classes’.
Poor people. They just think Microsoft is the best thing since sliced bread.
“After spending $1 billion to buy . . .”
That should read “investing” $1 billion
Come on Culpan, do your homework. But I guess invest wouldn’t fit your storyline as well.
Permit raj is back!