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Cheap smartphones besting Apple, Samsung in growing Indian market sales

post #1 of 44
Thread Starter 
Local smartphone makers in India with aggressively low prices are outselling worldwide market leaders Apple and Samsung, according to new data.

The sales are being driven by first-time smartphone buyers in India, according to a report published Friday by Bloomberg. The big winners have been Karbonn Mobiles India Pvt. and Micromax Informatics Ltd., which have priced their handsets below 4,000 rupees, or about $73 U.S.

India


In contrast, Apple's flagship iPhone 5 starts at 45,500 rupees, a price that's exceptionally high because mobile providers in India do not provide handset subsidies. Meanwhile, Samsung's Galaxy Grand is available in India for 21,500 rupees.

In a separate report filed on Friday by The Times of India, it was also noted that sales of Apple's legacy iPhone 4 ??a device that first launched in 2010 ? are currently outpacing the iPhone 5 in India. Sales have reportedly tripled over the last week after Apple began offering a discount of at least 7,000 rupees for customers who trade in any smartphone in exchange for an iPhone 4.

With that discount, customers can get an iPhone 4 for less than 20,000 rupees. But even at that discounted price, Apple is still well above the low-end competitors in India that are currently dominating sales.

The popularity of low-priced options in markets like India, China and Brazil, where contract subsidies are not common, has helped to drive speculation that Apple could release a new iPhone model with a lower price to address those markets. Reports have suggested that Apple plans to launch a low-cost iPhone model later this year made of a plastic shell to reduce costs.

However, it's unlikely that Apple would hit price points as low as Karbonn and Micromax are currently offering in India. Market watchers instead expect that Apple could offer an unsubsidized low-cost iPhone model for between $250 and $300.
post #2 of 44
People who cannot afford an iPhone buy cheaper phones. Thanks for the insight...
post #3 of 44
I'm curious about how smart these phones really are. Phone, web browser and email likely. Camera? What quality? Anything else? At that price they aren't likely to have too much going on. Which is fine if that's all the market wants. But it hardly equals the standard definition of a 'smart phone' in terms of the iPhone and Android

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post #4 of 44

It's to be expected there's plenty of people in the west can't afford iPhones, galaxies and the like.

post #5 of 44
People always buy more Fords. Doesn't mean they wouldn't love an Audi.
post #6 of 44
Quote:
Originally Posted by AppleInsider View Post

In contrast, Apple's flagship iPhone 5 starts at 45,500 rupees, a price that's exceptionally high because mobile providers in India do not provide handset subsidies. 

That's $840 (at current exchange rates) for a "starter" iPhone 5, which can be had fully unlocked in the US for almost $200 less. The local carriers are not just not providing subsidies, but they are actively screwing their consumers. It's no wonder Indians are not buying.

 

When/if Apple expands its direct presence in India, and if they price at US levels, watch the market share zoom. In other words, no need for the cheap stuff.

post #7 of 44
Quote:
Originally Posted by charlituna View Post

I'm curious about how smart these phones really are. Phone, web browser and email likely. Camera? What quality? Anything else? At that price they aren't likely to have too much going on. Which is fine if that's all the market wants. But it hardly equals the standard definition of a 'smart phone' in terms of the iPhone and Android

These Micromax and Karbonn mobiles are Android powered. And, they have their own hardware plants. Micromax comes with front camera of 2 MP and back camera with 8 MP.  People who can buy Android phones can buy these Micromax phones.  They even make Tablets. Open Hardware Alliance is the key.

 

Also... whatever Android can do... like full featured web browser etc.  And also, they come with extendable memory.  The thing is like... people who can buy iPhone and Galaxy, they are buying them.  But people who want to have smartphones and cant afford these two, definitely buy these Micromax and Karbonn mobiles.  They are good.  But not to the best of iPhone or Samsung. My friend's brother over India is using their tablets too! :)

post #8 of 44

The Galaxy Grand seems to have had a lot of compromises made to reach a 21,500 Rupee price point.

 

It is more like the iPhone 4 than the 5, reflected in the pricing being in the same ballpark.

 

http://www.phonearena.com/phones/compare/Samsung-Galaxy-Grand,Apple-iPhone-4/phones/7583,4586

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post #9 of 44
Quote:
Originally Posted by AppleInsider View Post

Apple's flagship iPhone 5 starts at 45,500 rupees, a price that's exceptionally high because mobile providers in India do not provide handset subsidies. Meanwhile, Samsung's Galaxy Grand is available in India for 21,500 rupees.

1. You can't put a price on quality. I'd say the Samsung phone is exceptionally high

2. Cut is out with the Apple-esque flag, will you AI.

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post #10 of 44
Quote:
Originally Posted by anantksundaram View Post

That's $840 (at current exchange rates) for a "starter" iPhone 5, which can be had fully unlocked in the US for almost $200 less. The local carriers are not just not providing subsidies, but they are actively screwing their consumers. It's no wonder Indians are not buying.

When/if Apple expands its direct presence in India, and if they price at US levels, watch the market share zoom. In other words, no need for the cheap stuff.
They may not get subsidized phones but the service cost is dirt cheap. For less than $15 a month a person can get unlimited talk, text and data. That's for the upper end post paid plan. Cheaper plans also exist. So in the end the math becomes much more favorable for the Indians who are buying IPhones at full price.
post #11 of 44
Quote:
Originally Posted by khanzain View Post

Quote:
Originally Posted by anantksundaram View Post

That's $840 (at current exchange rates) for a "starter" iPhone 5, which can be had fully unlocked in the US for almost $200 less. The local carriers are not just not providing subsidies, but they are actively screwing their consumers. It's no wonder Indians are not buying.

When/if Apple expands its direct presence in India, and if they price at US levels, watch the market share zoom. In other words, no need for the cheap stuff.
They may not get subsidized phones but the service cost is dirt cheap. For less than $15 a month a person can get unlimited talk, text and data. That's for the upper end post paid plan. Cheaper plans also exist. So in the end the math becomes much more favorable for the Indians who are buying IPhones at full price.

That's a valid point; you will need to take all costs into account (pun intended).
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post #12 of 44
3rd world countries can't afford expensive phones, news at 10!
post #13 of 44
Quote:
Originally Posted by khanzain View Post

They may not get subsidized phones but the service cost is dirt cheap. For less than $15 a month a person can get unlimited talk, text and data. That's for the upper end post paid plan. Cheaper plans also exist. So in the end the math becomes much more favorable for the Indians who are buying IPhones at full price.

Not relevant, since such low cost plans are similar for all smart phones. Also, the reason for low cost is, most systems are still legacy 2G or 2.5G. (3G has been barely rolled out, let alone 4G which is non-existent).

post #14 of 44

Apple doesn't make wooden phones.

post #15 of 44
When you have 1/7 of the world population, it's big news. Apple needs to consider these things (which I'm sure they already have). They must have decided that quality is better/more financially rewarding than quantity
post #16 of 44
And Tata sells a $1000 car in India. Does that mean all other auto manufacturers should be worried and need to lower their prices to match?
post #17 of 44

None of you know me from Adam's housecat.  That being said, I'm sharing a cube with an Indian (cross-training) who is in the States temporarily.

 

I showed him this article, and he has never heard of Karbonn or Micromax.  (He has an iPhone 4S.)
 

post #18 of 44

This proves what I've always been saying. There is no use for Apple to go after some of the poorest people in the world, because Apple can never win the race to the bottom. And I think that it's pretty telling when even cheap Android phones can not capture the top spot in India.

 

I didn't think that you could get more bottom of the barrel than Android, but apparently, somebody else has outdone them.lol.gif

post #19 of 44
Quote:
Originally Posted by Evilution View Post

3rd world countries can't afford expensive phones, news at 10!

You'd be surprised what countries are considered 3rd world.
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post #20 of 44

Originally Posted by Evilution View Post

3rd world countries can't afford expensive phones, news at 10!

_____________________________________________________________________________________________________________

 

Check these two articles when you get a chance. Based on nominal GDP model, India stands 9th highest in the world and based on Purchasing Power Parity model, India stands 3rd highest in the world. Perhaps that's what you mean't  by "3rd world"? 3rd in the world!

 

Nominal GDP

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)

 

By GDP (PPP)

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)


Edited by firhill07 - 4/12/13 at 9:10am
post #21 of 44

Check these two articles when you get a chance. Based on nominal GDP model, India stands 9th highest in the world and based on Purchasing Power Parity model, India stands 3rd highest in the world. Perhaps that's what you mean't  by "3rd world"? 3rd in the world!

 

Nominal GDP

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)

 

By GDP (PPP)

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

post #22 of 44

The article in the OP gives the impression that Apple is not doing well in India, but how do they explain this article from today?

 

Apple has taken second place in the large and growing smartphone market in India by using a clever workaround on its pricing. 

 

Samsung, true to form, quickly copied the plan right down to the details shortly after it was unveiled,

http://www.electronista.com/articles/13/04/12/samsung.quickly.copies.plan.in.effort.to.counter.apple


Edited by Apple ][ - 4/12/13 at 9:38am
post #23 of 44
Quote:
Originally Posted by firhill07 View Post

Check these two articles when you get a chance. Based on nominal GDP model, India stands 9th highest in the world and based on Purchasing Power Parity model, India stands 3rd highest in the world. Perhaps that's what you mean't  by "3rd world"? 3rd in the world!

 

Nominal GDP

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)

 

By GDP (PPP)

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

When the average person is making $1219 per year, they obviously don't have much to spend on any phones.

 

India's per capita income (nominal) is $ 1219, ranked 142nd in the world,[1]

 

http://en.wikipedia.org/wiki/Income_in_India

post #24 of 44
Quote:
Originally Posted by "Apple 
[" url="/t/156938/cheap-smartphones-besting-apple-samsung-in-growing-indian-market-sales#post_2309552"]

The average is an irrelevant number. The potential market size is MASSIVE, with a middle class that will exceed the population of the US (or even the EU) in be next couple of decades.

It would by silly for Apple to not position itself to capture this market. Read this, for instance: http://www.mckinseyquarterly.com/Tracking_the_growth_of_Indias_middle_class_2032
post #25 of 44
Quote:
Originally Posted by Apple ][ View Post


Slight correction on the link, for which I thank you:
http://www.electronista.com/articles/13/04/12/samsung.quickly.copies.plan.in.effort.to.counter.apple
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post #26 of 44

Quote:
Originally Posted by Apple ][ View Post

The article in the OP gives the impression that Apple is not doing well in India, but how do they explain this article from today?

 

Apple has taken second place in the large and growing smartphone market in India by using a clever workaround on its pricing. 

 

That was discussed here not long ago.  Apple has second place by revenue, due to its high prices.  It's a low fifth place in number of sales, again due to its high prices.  That's even after quadrupling iPhone sales in the past few months via incentives such as trade-ins.

 

post #27 of 44
Quote:
Originally Posted by anantksundaram View Post


The average is an irrelevant number. The potential market size is MASSIVE, with a middle class that will exceed the population of the US (or even the EU) in be next couple of decades.

It would by silly for Apple to not position itself to capture this market. Read this, for instance: http://www.mckinseyquarterly.com/Tracking_the_growth_of_Indias_middle_class_2032

I don't disagree with you.

 

I'm not saying that Apple should pull out of India. There is a shitload of people in India, and even if only a certain percentage of them can afford iPhones, that's a lot of phones. I'm trying to say that Apple should not concentrate their efforts on the low end of the market, because I don't believe that they could ever win that market, since even Android is being undercut by cheaper phones.

post #28 of 44
Quote:
Originally Posted by PhilBoogie View Post


Slight correction on the link, for which I thank you:
http://www.electronista.com/articles/13/04/12/samsung.quickly.copies.plan.in.effort.to.counter.apple

Thanks. I fixed the link in my post also, in case somebody else were to click on it.

post #29 of 44
Quote:
Originally Posted by Chandra69 View Post

These Micromax and Karbonn mobiles are Android powered. And, they have their own hardware plants. Micromax comes with front camera of 2 MP and back camera with 8 MP.  People who can buy Android phones can buy these Micromax phones.  They even make Tablets. Open Hardware Alliance is the key.

 

Also... whatever Android can do... like full featured web browser etc.  And also, they come with extendable memory.  The thing is like... people who can buy iPhone and Galaxy, they are buying them.  But people who want to have smartphones and cant afford these two, definitely buy these Micromax and Karbonn mobiles.  They are good.  But not to the best of iPhone or Samsung. My friend's brother over India is using their tablets too! :)

thanx for the info. what app store do they use, media store and so on?

post #30 of 44
Interesting scenario...

Currently in the US there isn't much (any) incentive to buy a non-subsidized phone since monthly rates are the same either way. The difference tends to be if you're on a 2 year cract or not, and most people this as irrelevant as they have no intention of going without phone service at any time in the next 2 years.

A cheaper mobile that could be sold unsubsidized AND coupled with a lower monthly rate could be extremely attractive and disruptive to the US market. Wondering if this isn't already on T-Mobile's roadmap...
post #31 of 44
Quote:

Originally Posted by KDarling View Post

 

Apple ....is a low fifth place in number of sales, again due to its high prices.  That's even after quadrupling iPhone sales in the past few months via incentives such as trade-ins.

 

That just implies that the growth -- and profit -- opportunities are enormous. All it needs is some solid local Apple presence, and somewhat lower prices (that match the world average).

post #32 of 44
Quote:
Originally Posted by anantksundaram View Post

That just implies that the growth -- and profit -- opportunities are enormous. All it needs is some solid local Apple presence, and somewhat lower prices (that match the world average).

 

Yep.  Apple just needs to be willing to take a per device cash profit margin hit in return for more total revenue through sales quantity, similar to what they did with the iPad mini.

 

 Low cost smartphone market to hit $135B in 2013.

 

 

Will they do it?  Who knows.

post #33 of 44
Quote:
Originally Posted by Apple ][ View Post

I don't disagree with you.

 

I'm not saying that Apple should pull out of India. There is a shitload of people in India, and even if only a certain percentage of them can afford iPhones, that's a lot of phones. I'm trying to say that Apple should not concentrate their efforts on the low end of the market, because I don't believe that they could ever win that market, since even Android is being undercut by cheaper phones.

Jeez Apple ][, Micromax and Karbonn smartphones run Android. So Android phones arent being undercut by 'other' cheaper phones.

As for Apple's iPhone price strategy, ofcourse quality comes first. But that doesnt mean they cant reduce prices. Apple is just taking a fat profit margin. iPad and iPad Mini sell for really good price by feature ratio. And comparable Android tablets took a good time reaching that range. And still dont sell as much. Hopefully the rumored lowcost iPhone becomes a reality.

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post #34 of 44
Quote:
Originally Posted by spacerays View Post

Jeez Apple ][, Micromax and Karbonn smartphones run Android. So Android phones arent being undercut by 'other' cheaper phones.

As for Apple's iPhone price strategy, ofcourse quality comes first. But that doesnt mean they cant reduce prices. Apple is just taking a fat profit margin. iPad and iPad Mini sell for really good price by feature ratio. And comparable Android tablets took a good time reaching that range. And still dont sell as much. Hopefully the rumored lowcost iPhone becomes a reality.

Ok, so it was Samsung phones that are being undercut by other cheaper Android phones.

 

As for the rumored cheap iPhone, I guess we'll see what happens.

post #35 of 44
Quote:
Originally Posted by anantksundaram View Post

That's $840 (at current exchange rates) for a "starter" iPhone 5, which can be had fully unlocked in the US for almost $200 less. The local carriers are not just not providing subsidies, but they are actively screwing their consumers. It's no wonder Indians are not buying.

When/if Apple expands its direct presence in India, and if they price at US levels, watch the market share zoom. In other words, no need for the cheap stuff.

Doesn't India have some kind of import tax?

Regardless, the cheapie vendors are making less money than Apple in India.
post #36 of 44
If my math is correct.... You could buy the 4000 rupee phone.... Immediately trade it in to apple.... And save 3000 rupee
post #37 of 44
Quote:
Originally Posted by anantksundaram View Post

That's $840 (at current exchange rates) for a "starter" iPhone 5, which can be had fully unlocked in the US for almost $200 less. The local carriers are not just not providing subsidies, but they are actively screwing their consumers. It's no wonder Indians are not buying.

When/if Apple expands its direct presence in India, and if they price at US levels, watch the market share zoom. In other words, no need for the cheap stuff.

This is not carriers pricing the phone, but Apple and distributors!! subsidised contracts were tried in India and failed badly. Btw Apple have MAJOR influence on the pricing setting in India.
post #38 of 44
Quote:
Originally Posted by jungmark View Post

Doesn't India have some kind of import tax?

Regardless, the cheapie vendors are making less money than Apple in India.


Correct the Import tax is also driving up the price of unlocked phone, carriers not the enemy, but Indian Government, Apple and their Distributors!!
Before any jumps down my throat and say Apple hater, better jump my history on this forum!
post #39 of 44
th people who buy these phones also ride oxen.
post #40 of 44

You are misinformed my friend TATA Nano cost Rs.1,25,000 on-road that's around $2500 and whoever is saying third world countries can't afford expensive (put Apple here) phones are only partly right,entry level Apple iphone 5 16GB cost around Rs.46,000 ($824.78 at current exchange rate) and that's outright cost no handset subsidies(i have iphone 5 64 GB i paid Rs.60,000 around $1,100 for it),how many of you paid hard cash for your iphones?yes it's true only certain percentage of people would go for iphone in India but there are many reasons for that other than price-tag and Android phones are selling like hot cakes,Micromax is an Indian company which provides decent spec'd phones at very competitive price i'm providing links of local online shopping store for reference,good day.

 

1.Micromax

http://www.flipkart.com/micromax-canvas-hd-a116/p/itmdjhwueg4jvtsx?pid=MOBDJSG2SVNDGR72&ref=c56878c0-4c60-45be-a1d5-f3c50e8e3544  - $293.25 at current exchange rate.

 

http://www.flipkart.com/micromax-ninja-a89/p/itmdjjguxchngshz?pid=MOBDHZZRGFHB7JRY&ref=5a7f78fd-91d5-469a-83cc-8fc839821216  - $119.13

 

2. Apple

http://www.infibeam.com/Mobiles/i-Apple-iPhone-5-16GB-Smartphone/P-E-M-Apple-iPhone-5-16GB.html  - $824.78

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