Apple signals emerging-market rethink with India push

Mon Feb 25, 2013 8:17am EST
 

By Devidutta Tripathy and Harichandan Arakali

NEW DELHI/BANGALORE (Reuters) - As BlackBerry launches the first smartphone from its make-or-break BB10 line in India, one of its most loyal markets, the company faces new competition from a formidable rival that has long had a minimal presence in the country.

More than four years after it started selling iPhones in India, Apple Inc is now aggressively pushing the device through installment payment plans that make it more affordable, a new distribution model and heavy marketing blitz.

"Now your dream phone" at 5,056 rupees ($93), read a recent full front-page ad for an iPhone 5 in the Times of India, referring to the initial payment on a phone priced at $840, or almost two months' wages for an entry-level software engineer.

The new-found interest in India suggests a subtle strategy shift for Apple, which has moved tentatively in emerging markets and has allowed rivals such as Samsung and BlackBerry to dominate with more affordable smartphones. With the exception of China, all of its Apple stores are in advanced economies.

Apple expanded its India sales effort in the latter half of 2012 by adding two distributors. Previously it sold iPhones only through a few carriers and stores it calls premium resellers.

The result: iPhone shipments to India between October and December nearly tripled to 250,000 units from 90,000 in the previous quarter, according to an estimate by Jessica Kwee, a Singapore-based analyst at consultancy Canalys.

At The MobileStore, an Indian chain owned by the Essar conglomerate, which says it sells 15 percent of the iPhones in the country, iPhone sales tripled between December and January, thanks to a monthly payment scheme launched last month.

"Most people in India can't afford a dollar-priced phone when the salaries in India are rupee salaries. But the desire is the same," said Himanshu Chakrawarti, its chief executive.   Continued...

 
A salesperson unpacks an Apple iPad Mini to test it for a customer in the Apple specialty section of a Croma retail store in Mumbai February 22, 2013. REUTERS/Vivek Prakash