Dear Friends,
We are all aware of iPhone and iPod from Apple. Recently iPad was launched in the world, understand more than 1 million sets have been sold. At the same time there were two launches from India of the product similar in all respects to iPad. They are Adam from Notion Ink & Phi. Both are expected to have price advantages over Apple's iPad.
Do you think India being a price-sensitive country, Desi products will give iPad a run for the money whenever it is launched?
Or Desi version will die a natural death against the giant- Apple
Why iPhone is not able to gain a sizable market share in India?
I would like to hear your views and plan of action for both companies - Apple & desi companies. You may choose one of them for your analysis and final recommendation.
I shall be requesting senior alumni to judge your plan of action and choose the best first three.
Why wait, let us start!
Best wishes
Dear Sir,
ReplyDeleteYou have already mentioned one of the reasons of why iPhone is not able to gain a sizable market share in India as we are a price sensitive country. But things might change after the launch of iphone 4 in India in September. Everybody knows how successful the apple ipods have been in the last 5 years. But few people however are aware that for the first 3 years the iPod was an absolute flop. So taking a cue from ipods, we should acknowledge the fact that the right time hasn’t come to declare iphones a flop in India.
No doubt, Apple has been able to develop a revolutionary product, for the mobile phone market. Apple did great on the product side,. However Apple has done some serious mistakes in the marketing of the iPhone. Firstly, the fluctuations in the price,Apple made a big marketing mistake in 2007 by reducing the iPhone retail price from $599 to $399 - a 33% rebate - after only 3 months from the initial product launch. This way the iPhone early adopters - and Apple’s most faithful costumers have rightfully felt being betrayed and exploited. A great company should not do such serious mistake, betraying their most faithful customer base.
Secondly, On June 29, 2007 the iPhone was launched in the US. Only on July 11, 2008, one full year later, the iPhone has been launched in several other European countries. Why so late?
Now talking about India and iphone 4, Apple iPhone 4 will have to face very tough competition from the Nokia and Sony because the prices of these phones are much lower than Apple. The cost of Apple iPhone 4 in Indian market is Rs 35,000 for the version of 16 GB and Rs 41,500 for the version of 32 GB. But in US, the 16 GB version of the iPhone 4 is available with a price tag of $199 whereas the 32 GB version is present with the price tag of $299. While the initial frenzy of $199, i.e. Rs. 8,000/ has settled down, it’s time to look at the price component of iPhone in US.
Manufacturing cost of new iPhone is $173 (excluding the cost of developing software, which will be amortized in the long run) – drop of $53 from the earlier version.
iPhone is sold to operators for $300+ (under the new deal with AT&T, Apple no longer receives a portion of the carrier’s revenue from service subscriptions)
The current price of $199 is the subsidized price with operators taking a hit of ~$300
But here in India such subsidized price is a distant reality. “US operators are able to subsidize handsets because they can make up for that with their call charges. They charge rates like 25 cents a minute. In India, the charge is 1.5 to 2 cents a minute,” ex CEO of Bharati Airtel and currently head of its international business division, Manoj Kohli said.
But still iphone lovers would surely go for it and then the gray market is providing sets at much lower prices though it might be riskier to buy from there.
At last, thank you very much sir for providing us food for thought which prompted me to know much more about iphones and I feel sorry for my late reply. I would soon comment on ipads also, probably in a day or two.