Is Apple really doing badly in India?

IANS

Given the current market conditions in India for smartphones, it appears that Steve Jobs, the late Apple co-founder, was prophetic: He did not consider this country a significant opportunity.

 

In the decade since its arrival, almost all the segments — barring the $100 to $200 segment — have seen a decline in the competitive and price-sensitive Indian market. The big question now is: Has Apple’s poor performance in India been on account of some loose ends in its strategy? Or is it merely because of the segment/s in which the Cupertino-based iPhone-maker operates?

 

Over its decade-long presence in the country, Apple has been operating in three price segments. Among these, $400-plus has been the staple where the tech giant has performed superbly. From just over five per cent share of the segment in 2008, when Apple said ‘Namaste’ to India, it currently enjoys over 47% share in the $400-and-above smartphone segment by units.

 

In terms of revenues, Apple has also seen consistent growth despite pressures like shrinking opportunities in the premium segment as well as falling average selling prices — not the forget the “forced” downward movement to cater to the mid-premium segment. In 2017, till September end, there has been a 21 per cent revenue decline compared to the calendar year 2016.

 

But then, Apple has witnessed good annual growth rates since 2010 — its average annual revenue growth rate has been 116% in its first decade of presence in India. Both from the revenue as well as volume aspects, Apple has seen a consoling India story so far.

 

The real issue is the growth in the premium segment with several players, incluing from China, now offering devices. This segment is going to see some difficult times ahead owing to the fact that, after Jio surfaced on the landscape, the opportunity now shifts towards the entry-level players to let a user have his or her first smartphone experience.

 

The overall declining growth in all price segments of smartphone over the last decade or so, Apple’s consistent growth in revenues as well as its increasing growth in market share in the segment(s) it is present, has an interesting story to tell.

 

For Apple, revenues as well as its market standing is on the rise so far, as it faces the peculiar nature of the domestic market. Was Jobs able to foresee this peculiarity of the Indian smartphone market or was his interpretation something different? Whatever his interpretation, the impact for Apple is more or less the same.