Report: Apple struggling with iPhone in India
Apple's initial foray into India hasn't gone as well as it has around the rest of the world.
(Credit: James Martin/CNET News)There is a huge market for mobile phones in India, but according to the locals, Apple's iPhone hasn't even made a dent.
That's the conclusion of a long story published by LiveMint.com analyzing the first few months of Apple's foray into India with the iPhone 3G. Analysts estimate that just 11,000 iPhones have been sold in India since Apple launched in that country in September, which is probably equivalent to a week's worth of sales at the downtown San Francisco Apple store.
It doesn't seem that Apple ever thought it would make a huge splash in India, allocating just 50,000 iPhones to that market, according to the article. Of the 120 million mobile phones sold in India each year, around 6 million are of the smartphone variety, and Nokia owns the market with between 60 percent and 70 percent market share.
Several reasons are given for the tepid debut of the iPhone in India: price, promotion, and distribution. The authors note that India's mobile market doesn't follow the carrier subsidy model used in most places around the world, and as a result the iPhone is being sold for far more than some had expected after the $199 (9,500 rupees) worldwide price was announced. Still, that doesn't seem to have been the primary reason for the slow sales, since competing phones are priced about the same as the 30,000-rupee 8GB iPhone, although some think that customers thought they would get the cheaper price and were disappointed that it didn't apply to them.
The real reason seems to be that Apple and its carrier partners (Bharti Airtel and Vodafone) didn't promote the iPhone as aggressively as was done in other countries. And distribution in India is a convoluted process involving several different retailers that employ multiple strategies to reach the many different types of customers that are found in India, according to the article.
The article is worth a read for anyone wondering how one of the world's fastest-growing countries looks at the mobile phone market. Considering Apple has yet to make a splash in India, hasn't officially launched in China, and is going to easily surpass its goal of shipping 10 million iPhones worldwide this year, the company would seem to have a lot of room for growth in those two countries next year.
Tom Krazit writes about the ever-expanding world of Internet search, including Google, Yahoo, online advertising, and portals, as well as the evolution of mobile computing. He has written about traditional PC companies, chip manufacturers, and mobile computers, spending the last three years covering Apple. E-mail Tom. 
you done me proud, india.
Price is also a major consideration as when the price is far more than had been expected, the incentive to buy is diminished. Plus, India is a Microsoft house.
Besides, who needs an iphone anyway? In India, probably the 11,000 people who own one.
India ... That's Microsoft Country Fools!
Price is far bigger factor than promotion and placement. At INR 30,000 (US $ 600+) the phone is affordable by less than 2% of mobile phone buyers since it is not subsidized by the carriers.
India is not a Microsoft house in Mobile arena as the majority of the smart phone market is owned by Nokia and Sony Ericsson phones running Symbian and even Linux.
Nokia N95 can be purchase dofr INR 20,000 in the open market so why would someone go for iPhone shelling out another extra 10,000 (US $ 225).
Apart form price, promotion has been dismal, considering that even non smart phones have big launches and publicity aided by Bollywood stars and Cricket players, the iPhone publicity was dismal.
Also India's mobile infrastructure does not have a 3G network, and Edge download speeds rarely exceed 128 kbps in most cities (upload speeds are even more horrible).
In short these dudes crewed up on the market in India.
1. Apple's never been very good at marketing themselves in India. The iPod sells thanks to word of mouth despite the fact that the itunes store doesn't sell music (only apps for the iphone/touch).
2. Visit an "apple store" here and check out the ignorance and arrogance of the sales staff. Major put off for anyone trying to learn about their products.
3. The iphone is extremely expensive AND locked to one of two providers.
4. Compare with Nokia's offerings - N95/N96/N85/E71/E61/E66 to name a few - which are cheaper, have better specs, and are available EVERYWHERE. Nokia's direct sales and resellers also are much more aggressive at offering options. They start by asking you what you want to do with the phone? Photos? N series. Email? E series. Full size qwerty keyboard? E90. Small qwerty? E71 (the best phone in the world right now, BTW.)
Last and not least, the iPhone is basically an ipod touch with phone capability. High end smartphone users here are extremely technical aware and aren't easily fooled by the lack of substance that the iphone has - a cool touch screen UI and the app store - why would I pay a 100% premium over the touch to get those features? Apart from the obviously broken features - bluetooth, sms forwarding, lack of mms, cut/paste (come on! the dumbest exclusion ever), the idiotic lack of folders in the UI ... the list is endless.
And I type this on one of my several Macs. The iphone is the only Apple product that I've used and hated. The one Apple product I go out of my way to tell people NOT TO BUY.
1) "a phone with very few features/specs for really high price"
2) People who wanted iphone already have them.....they get it int he black market or ask someone in US of A to get it. Then they are hacked and used. So ignoring the big markets like India for so long as Apple did in its case, was a major factor for its dismal performance.
India ... That's Microsoft Country Fools!<<<
Not necessarily. IBM was certainly no friend to India and pulled out when India wouldn't let them get away with what they wanted to, there had to be more in it for India. Burroughs took better advantage of the situation and made an alliance with Tata, which is one of the largest companies in India, forming Tata-Burroughs, hence giving something back to India. Tata is an all-round company as well as being one of India's largest car manufacturers (along with Mohindra and Mohindra), the founder of Air India (which was nationalized from Tata Airways), and is a very large consultancy organization.
I don't think India is in any way welded to Microsoft, you just have to give them a better deal and make them partners. India is also more likely to like the aesthetics of Macintosh than Windows ? they appreciate good design, art, and spirituality which is present in Mac but devoid in Windows. They'd rather the art of the Hindu Maharajas, than the denial of art, as with the Muslim Moghuls like Aurangzeb (although other Moghuls encouraged discussion and art, like Akbar and Shah Jahan who built the Taj Mahal). The Moghul empire reached its greatest spread under Aurangzeb, but then all but disappeared after him. India can very quickly change, and bring it about by peaceful and patient revolution.
In order to sell to India, you must appeal to India's sense of culture.
????
IPHONE which is sold in U.S at less than $200 (INR 9860) is positioned at India for $608(equivalent INR 30,000) . The mainstream business magazines in India has published the article before the iPhone launch and criticized the pricing policy which is 3 times more costlier for Indian consumers. Apple decided not to care about this and launched the product at $608.
In India NOKIA sells N Series and E series phones in good volumes. Sony and Samsung too sell high end phone in bulk volumes. The census of IT professionals in Bangalore itself is close to 1 million. Why did Apple fail when other companies succeeded in selling high-end phones? Good Case to study.
Many of the prospective customers looked at one more aspect of a product - Value for Money.. decided to go for a Nokia , Sony or So. Do Fair Business. The World is Flat.. The impression Apple has given to Indian consumers is very bad. This will have ripple effect on all further product launch from the company.
The contribution of Carrier suppliers, promotion and distribution is significantly less and can be ignored in this Failure.
1) "a phone with very few features/specs for really high price"
2) People who wanted iphone already have them.....they get it int he black market or ask someone in US of A to get it. Then they are hacked and used. So ignoring the big markets like India for so long as Apple did in its case, was a major factor for its dismal performance.
1. Very very high price (31K gor 8 Gb version)- Even if they would have kept around 20K they would have increased theirs sales many folds.
My reaction and many of my friends reaction - I will buy a laptop instead. (Then you have these netbooks giving you mobility and storage. Spend 22 K on a netbook and an 8 k phone)
2. You have HTC touch phones available here which sells better - HTC Touch Diamond has a better spec and a lower price - as compared to Iphone. Then E71 - great great phone only 20 K.
3. I had got mails that were anti Iphone -citing its inability on many fronts to match some of the other phones - Copy/Paste, video recording, Normal file transfer using BlueTooth between an Iphone and some other phones. Indians are very particular about these trivial things.
4. Bad marketting/Ads - bad follow up too. No price reduction even now!!
5. People in India - they have major trust in Nokia. They are rigid about this and Apple did not do anything to change this feeling amongst the Indian consumers.
- people know it sells for $199 in the US. they are not going to fork out 31,000 (8gb model) for the same thing.
- people do not like being tied into a service provider. they have been using SIMs for ages, changing their phones, and they do not like a lock-in.
- Nokia phones with comparable features cost around 15k - 20k INR.
- GPRS / EDGE is not used by most people. They do not want to be forced into an account like that.
- since most people are not on the www, they would prefer to get cheap iPhones
prices of the macbooks have slashed by almost 50%, and unless this happens for the iPhone, it will not sell much.
Another interesting fact is that the species named "Apple Fanboys" (or "Fangirls", as the case may be) doesn't exist in India. The reason - In my 24 years I have yet to see a Mac anywhere except showrooms and tech shows. I believe that is one of the primary reasons that drives the sales in US - the whole 'Apple' factor.
P.S.:- To the credit of Apple, 'iPod' has actually become a generic term for MP3/Media players in India. Laymans walk into shops asking salespeople questions like "I need an iPod that can play video, is 4GB and around INR 7500 (around $145)". If the salesperson gives him a Creative Zen or a Sony Walkman which fits the bill, the item is bought and no questions are asked !!!
i would buy the same day
- by dennis_the_bug November 15, 2008 1:40 PM PST
- Hahahaha, down the drains, Apple. This one is for slogging your employees.
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