Apple files government application to open Apple Stores in India

AppleInsider

Apple fans living in India might soon be treated to the Apple Store experience, as the company this week filed an application to open its own branded outlets in the South Asian country.

Secretary of India's Department of Industrial Policy and Promotion (DIPP), Amitabh Kant, confirmed to the Economic Times on Wednesday local time that Apple's proposal was "just received" and is currently under review. India's recent decision to relax direct foreign investment regulations likely played a role in Apple's filing, as the company no longer faces strict product procurement and online sales rules, the report said.

The confirmation comes after years of rumors and speculation concerning an official Apple retail presence built to serve India's burgeoning marketplace. In October, the iPhone maker was said to be in talks with electronics chain Croma over a potential store-within-a-store concept to bolster regional operations, while Indian Prime Minister Narendra Modi met with Apple CEO Tim Cook to discuss potential investment opportunities in September.

Through its current network of authorized resellers, Apple last year crossed the $1 billion sales mark in India for the first time, according to data published by Registrar of Companies in November. For the three-month period ending in March 2015, sales were up 44 percent year over year, while net profits doubled.

As part of its global strategy, Apple is looking to expand into areas exhibiting a rise in middle- to upper-middle class earners, China being a prime example. Earlier this month, AppleInsider was first to report an upcoming push into Latin America that will see flagship and satellite Apple Stores open in Argentina, Brazil, Chile, Mexico and Peru. The report was confirmed by Apple three days later.

macky the macky

I wonder if they'll get the store open in time for the 4" iPhone's intro.

Apple's application fee was 16 billion rupees, or about one US dollar. 

Amitabh Kant said a store won't take long to have open, "Some straw, a couple cows..."

slprescott

This could be a positive talking point in the upcoming Earnings Call, as India = Growth = Wall Street's priority.

anantksundaram

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

edited January 2016

stubb

Can't wait to see how analysts will spin this as bearish for Apple's long-term prospects. Desperate grasping by a company that's run out of ideas?

applesauce007

That's carrect, they vill open a store in India.

radarthekat

anantksundaram said:

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

Looked at it another way, Samsung and others have been selling in India without much competition from Apple at the high end of the market. So Apple's entry not only increases Apple's global distribution footprint, at the same time it cuts into Samsung's sales and profits.

spamsandwich

anantksundaram said:

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

Not surprising considering the overwhelming levels of theft in India. I'm sure people love Android for its "openness".

edited January 2016

anantksundaram

SpamSandwich said:

anantksundaram said:

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

Not surprising considering the overwhelming levels of theft in India. I'm sure people love Android for its "openness".

What 'theft'? IP? If so, that's arrant nonsense. You might be confusing it with other countries.

edited January 2016

electrotech

anantksundaram said:

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

Unfortunately, quality is not an Indian trait. Good enough it the highest standard in most of their work so it stands to reason that Apple's superior quality is wasted on the Indians. I have been to India 3 times and spent about a month total visiting my new Indian relatives (wife's side) and learned a lot about the Indian ethos and way of living. Quality is job none.

anantksundaram

electrotech said:

anantksundaram said:

On a recent trip to India, I was stunned by how ubiquitous Samsung was there, especially their high-end and larger screen size smartphones. Among business people and among people patronizing higher-end hotels, restaurants, and stores. Every single person seemed to have one. There were a handful of iPhones, almost always the the 6/6s or +. (I did see a fair number of Apple billboards though, which I had not seen when I was there a couple of years ago). 

The general sense was that the iPhone was terribly overpriced, and that a high-end Android phone offered pretty much the same functionality. The 'ecosystem' argument did not play well, since co-offerings such as iTunes, App Store, and ApplePay are poorly developed or implemented in India.

With 3G ubiquitous now, and 4G being aggressively rolled out, the smartphone market is clearly taking off there. It will be a HUGE market. Apple can be successful, but it's not a gimme given the incumbency of Android. I predict it'll be a slog. 

Unfortunately, quality is not an Indian trait. Good enough it the highest standard in most of their work so it stands to reason that Apple's superior quality is wasted on the Indians. I have been to India 3 times and spent about a month total visiting my new Indian relatives (wife's side) and learned a lot about the Indian ethos and way of living. Quality is job none.

I don't disagree, but quality didn't used to be a Chinese trait either.... yet, how's Apple doing there?

It's silly to think that people don't value quality (in relation to price) anywhere.

avidthinker

stubb said:

Can't wait to see how analysts will spin this as bearish for Apple's long-term prospects. Desperate grasping by a company that's run out of ideas?

Would not be surprised in the least bit if they did.  Most banter coming out of Wall Street is completely devoid of imagination or prescience.  A lot of analyst commentary I come across see out only to the short-medium term, rarely long-term if ever.

India is a terrific growth story, and Apple's growth there will likely many years (a decade?) to develop.  Yes, currently, India's GDP per capita is a fraction of China's and consequently retail prices of the newest iPhones and other products are out of reach for majority of population, but we're talking about a country with the following traits working in its (and Apple's) long term favor:

1. English as an official language
2. Geographically equidistant to North America and Europe (which should facilitate additional growth of its services sector)
3. Some of the best engineering schools in the world (engineers know what the best tools in the trade are)

That's my economist two-cents on how I think this will be play out in the long term.  There are of course lots of things going against my thesis on India (e.g. desperate need for economic reforms, brain drain) but I err on the side of optimism

edited January 2016