Why Apple’s iPhone can’t compete in India

“When Tim Cook was in India back in 2016, he said that Apple was in the country for a ‘thousand years,'” Kunal Dua writes for The Verge. “With iPhone sales in India on a downward trajectory, the joke doing the rounds is that Apple might actually need that kind of time to make a significant dent in the world’s second-biggest phone market for feature phones and smartphones. Unfortunately for Apple, any good joke often contains a grain of truth.”

“Apple reportedly shipped fewer than 1 million iPhones in the first half of this year, according to Counterpoint Research; less than 2 percent of the estimated 60 million plus smartphones that were shipped in the country during the time,” Dua writes. “The latest numbers are disappointing for a company that was steadily increasing market share on a higher volume of sales in recent years. Apple shipped 2.6 million iPhones in India in 2016, a growth of over 50 percent compared to the year before. That number rose to 3.2 million in 2017, but by the end of last year, there were signs that the growth was slowing down. According to Counterpoint, Apple’s share of the Indian smartphone market has dropped to just 1 percent as of Q2 (April to June) 2018.”

Dua writes, “Tim Cook, who’s long been bullish about Apple’s prospects in India, faces what could be insurmountable challenges in finding a secure foothold in the world’s third-largest market for smartphones.”

Read more in the full article here.

MacDailyNews Take: Do not count Apple out of any market at any time.

SEE ALSO:
Apple sales execs depart as company flounders in India – July 16, 2018
Made-in-India iPhone 6s production underway as Apple looks to avoid Indian import tax – June 26, 2018
Apple ups iPhone prices in India as government hikes taxes on imported phones – December 18, 2017
India raises import tax on electronic products, including cellphones; move to hurt Apple – December 15, 2017
Apple slashes prices of iPhone 7, iPhone 7 plus, iPhone 6s in India – September 14, 2017
Apple seeks tax breaks for suppliers to make iPhones in India – August 1, 2017
Indian Prime Minister Modi meets with Apple CEO Cook ahead of President Trump today – June 26, 2017
Apple broadens their iPhone attack in India, the world’s second biggest mobile market – June 22, 2017
Apple is making old iPhones new again to win India – June 12, 201
Apple again asks Indian government to allow sale of certified refurbished iPhones in India – February 6, 2017
Indian IT minister says Apple plans to make iPhones in Bengaluru – February 3, 2017
Apple nears deal to manufacture products in India – January 25, 2017
Apple is ready to make iPhones in India, for a price – January 20, 2017
India to consider Apple request for tax breaks and policy exemptions with ‘open mind’ – January 18, 2017
Apple is horse-trading mightily with India – January 4, 2017

13 Comments

  1. In a country that has been traditionally protectionist, India charges electronic imports about 30% of retail.

    The average Android handset in India sells for under $200. iPhone ASP is >$700 not including India’s import fees.

    It doesn’t take a genius (not to be found in the media) to figure out that $200 handsets will sell much better than $900+ handsets.

    Cook is optimistic about the future of India because of the ongoing liberalization (a painful process) of its economy that has caused the following (from Wikipedia): “Averaging an economic growth rate of 7.5% for several years prior to 2007,[219] India has more than doubled its hourly wage rates during the first decade of the 21st century.[228] Some 431 million Indians have left poverty since 1985; India’s middle classes are projected to number around 580 million by 2030.[229]”

    By 2030 India’s MIDDLE CLASS will be about 40% larger than the entire population of the US.

    Selling 1,000,000 iPhones this year does not represent the potential for sales 5, 10 or 15 years from now.

    Unlike the author, Apple thinks in 5 years and longer time frames.

    Dua’s article is a piece of shit focused on the past with no forward-looking component.

    1. With Google’s investment in KaiOS and Apple’s closed ecosystem providing very few Apple services outside of iOS, the next decade may turn out even worse for both iOS and Android phone sales while increasing the Google Services audience by a magnitude or two.

  2. How come no one complains about how few Lamborghinis are being sold in India. Oh, well. When it comes to Apple, everything is always measured in terms of market share percentage and Apple never seems to have much of that. Most of us know that Apple isn’t going to be reducing iPhone prices to make them as affordable to Indian consumers as low- to mid-range Android smartphones. I’ll never know why these things come as a surprise to the news media.

    I have no idea how many iPhones Apple thought it could sell in India but I’m sure they had a reasonable number in mind. I’d think it would be somewhat easy to get a close number if Apple knows the average yearly salary of an Indian consumer.

    1. If people did write about how many Lamborghinis were sold in India, I can assure you it would be MUCH smaller percentage there than they sell in Italy. The point is that Apple sells millions and millions of iPhones in other countries not nearly as big as India. Apple has 38% of the market in the US, 1% in India (which has 4 times the population but 1/100th the income). As Indians get richer, they will start buying more iPhones. Until then, Apple will have to wait it out b/c they’re not going to (nor can they really) drop their prices there…

      1. “As Indians get richer,”

        Good post macman1984

        From Wikipedia:

        “According to a 2011 PricewaterhouseCoopers report, India’s GDP at purchasing power parity could overtake that of the United States by 2045.[234] During the next four decades, Indian GDP is expected to grow at an annualized average of 8%, making it potentially the world’s fastest-growing major economy until 2050.[234]”

        US GDP growth is considered robust when it hits 3%. Right now it is averaging about 2.5%.

        India should be (and is by Apple) viewed as a long-term project with strong results appearing in 5 – 10 years.

  3. A friend of mine who lives in India tells me there is also an intangible factor. Apple is seen as a hipster brand in India. To which I responded, “What about the success of Harley Davidson in India?” She says that Harley is the quintessential American brand and it makes people feel like cowboys, tough, free, independent, while Apple is kinda “gay.” Her words. Not mine.

    1. I could see how KaiOS could dampen iOS and Android device sales but at the same time somewhat close the digital divide in India. Google’s investment in it seems a good move to get new Google Service users ‘early’ before they move up from KaiOS feature phones to smartphones.

  4. Greedy Tim Cook made a huge mistake in India. Now when he gets kicked out of there because he is not budging on privacy issues, and the Indians wont budge on their taxes. Lose lose both both teams and Tim cook should have predicted that. Tim should instead concentrate on China and Japan and let someone else have the cheap Indian market

  5. Until today I had never heard of KaiOS. I had to look it up on Wiki. It makes sense for India where most people have little money. Hopefully the government there will wake up and start protecting their citizens’ privacy.

Leave a Reply to Laughing_Boy48 Cancel reply

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