Why the iPhone can not compete in India

Kunal Dua ( @duak ) is the editor of Gadgets 360 India's largest technology information website with over 40 million unique visitors.

When Tim Cook was in India in 2016, he said that Apple had been in the country for "a thousand years". With iPhone sales in India on a downward trajectory, the joke is doing the trick is that Apple might actually need that kind of time to make a noticeable in the world's second largest mobile phone market. Unfortunately for Apple, any good joke often contains a grain of truth.

Apple reportedly shipped less than 1 million iPhones in the first half of this year, according to Counterpoint Research; less than 2% of the approximately 60 million smartphones that were shipped in the country during this period. Its rival Samsung, which has dominated the smartphone landscape in India for several years, has delivered 17.4 million smartphones over the same period, according to Canalys analysts, while Xiaomi has shipped nearly 19 million smartphones. units.

Apple, a company that seeks profitability over the phone instead of volume, has never really competed with Samsung's tastes in terms of overall smartphone shipments to India. Yet the latest figures are disappointing for a company that is steadily increasing its market share on higher sales volume in recent years. Apple shipped 2.6 million iPhones to India in 2016, a growth of over 50% over the previous year. That number rose to 3.2 million in 2017, but by the end of last year, there were signs of slowing growth. According to Counterpoint, Apple's share of the Indian smartphone market fell to only 1% in the second quarter (April to June) 2018.

The iPhone's share in the Indian smartphone market is now "the weakest of recent history" Counterpoint. Tim Cook, long optimistic for Apple's prospects in India, is facing insurmountable challenges to find his place on the world's third largest smartphone market.

A price-sensitive market

The main reason for Apple's fight India is that its devices are sold at the top of the market, while the vast majority of Indian users buy devices less Dear. The flagship Apple 256GB iPhone X is sold in India at Rs. 1,08,930, or about $ 1,600, while the average price of a smartphone is about a tenth of the price. According to Counterpoint Research, the "premium smartphone market" – phones that cost Rs. 30,000, or about $ 450 – contributes only 4% of total smartphone sales in India.

Image: Counterpoint

In the last three quarters, smartphone shipments in India have hovered around 30 million units. Yes, they exceeded 40 million in the third quarter (July to September) last year, when you saw these stories "India is now a bigger smartphone market than the United States," but this is no longer the case since. All products in the current Apple iPhone range – with the exception of the basic variant of the iPhone SE, which starts at Rs. 26,000, or about $ 380 – have recommended prices which place them in this "prime" range. Even though Apple captures 100% of this market, you are still facing a cap of only 1.2 million units per quarter. Of course, Apple's share of the high-end product market is far from 100%, as Samsung and OnePlus face high-end sales in India.