Apple killing it in India: grabs first place with 66% of premium phone sales

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in iPhone
Apple crushed Samsung in the emerging market for premium smartphones in India during October, taking a leading 66 percent share of sales. Samsung's second place accounted for 23 percent of sales from Galaxy S7 and similar phones, while Google--which has made the subcontinent a focus--took 10 percent of sales. Only 1 percent was attributed to other makers.


Mumbai, India


While Apple's sales in India are often portrayed as a struggling, slow effort--due to the fact that far fewer Indians can afford premium phones compared to leading markets such as China and the United States--the figures from Counterpoint Research show that Apple is actually performing very well in India.

As it does worldwide, Samsung still sells more basic smartphones in India than Apple, but those devices are not generating sustainable profits. Samsung's earnings from phone sales come almost entirely from its premium models, and those sales were knocked down by the failure of its latest flagship model, the fire-prone Galaxy Note 7.

Counterpoint Research data was published by India Times in an informercial by Gulveen Aulakh seeking to promote Google's third place standing.

The piece stated that "Google shipped 33,000 units of Pixel to India as of October end," indicating that Apple sold nearly a quarter million handsets during the month. Google boosted sales with a variety of discounts, cash back offers, and a "heavy spend on marketing" which was used to "showcase Pixel and Pixel XL in key stores of large-format retail chains including Croma, Reliance Digital, Spice Mobility and Jumbo." "Our iPhone sales in India were up over 50 percent in fiscal 2016" - Tim Cook

Apple's chief executive Tim Cook has focused increasing attention on India as an important emerging market for the company.

"Our iPhone sales in India were up over 50 percent in fiscal 2016 compared to the prior year, and we believe we're just beginning to scratch the surface of this large and growing market opportunity," Cook told analysts in October during Apple's quarterly earnings call.

Responding to an analyst question, Cook noted almost half of all Indians are under the age of 25, and the already populous country is expected to swell beyond China in the next decade. India's GDP is on the way up, as well, though might not be a factor in iPhone's success.

"That's not critical for us to have a great success there," Cook said. "The truth is there's going to be a lot of people there and a lot of people in the middle class that will really want a smartphone, and I think we can compete well for some percentage of those. And Given our starting point, even though we've been growing a lot, there's a lot of headroom there in our mind. So, we're working very hard to realize that opportunity."

In May, after Strategy Analytics reported very limited overall market share for iPhones across the entire market including low end models, Cook told the Indian media, "We are in India for the next thousand years. Our horizon is very long. We are focused on best, not most. So it doesn't bother me that we don't have top market share."

After a failed bid to prove that it was selling state-of-the-art or cutting edge technologies, Apple has been fighting India's local sourcing rules that demand that a multinational company source 30 percent of its components in India before retail establishments can operate. However, single-brand retailers like Apple now have a three-year grace period to operate stores before mandatory compliance of the 30 percent rule.

Apple's main assembly partner, Foxconn, is believed to be planning an Apple-focused factory for India, which would fulfill the 30 percent mandate. No deal has yet been signed, and even after negotiations complete, operations would take more than a year to commence.

Earlier this year, Apple launched a technology center in Hyderabad, focused on Apple Maps development. In July, the company leased 40,000 square feet in Bengaluru for a planned design and development accelerator. Neither software development center will have any effect on sourcing percentages

Comments

  • Reply 1 of 20
    NY1822NY1822 Posts: 561member
    "Google shipped 33,000 units of Pixel to India as of October end," indicating that Apple sold nearly a quarter million"

    translation: shipped vs sold 
    Google shipped 33,000 units = Google sold 5,000 units and gave away 27,000 units)
    edited November 2016 stanthemanmagman1979mejsricbadmonkwatto_cobrajony0
  • Reply 2 of 20
    NY1822 said:
    "Google shipped 33,000 units of Pixel to India as of October end," indicating that Apple sold nearly a quarter million"

    translation: shipped vs sold 
    Google shipped 33,000 units = Google sold 5,000 units and gave away 27,000 units)
    Link? Any valid proof?
    perkedel
  • Reply 3 of 20
    This is hardly surprising. October was the launch month for the iPhone 7 in India, the Note 7 went kaboom over there like it did everywhere else and the Pixel is brand new phone line that still has to prove itself.
    watto_cobra
  • Reply 5 of 20
    This is hardly surprising. October was the launch month for the iPhone 7 in India, the Note 7 went kaboom over there like it did everywhere else and the Pixel is brand new phone line that still has to prove itself.
    Quite unlikely. One, Samsung has had a solid presence in India for a number of years now. The brand is extremely well-known. Their billboards are everywhere, they have locked up some of the mega-movie and cricket stars as their brand ambassadors, etc. Two, Note 7 is far from the only 'premium' model that Samsung sells, as you well know. Three, the article does not tell us which Apple models sold. The iPhone 7 is only a part of Apple's offerings.

    Apple is a highly sought-after, aspirational brand in India. You're clearly trying to pour cold water on a solid achievement by Apple there. Take it elsewhere.

    And, to the regulars who're naysayers about Apple and India in this forum: it'll take a few years, but this is merely the start. 
    edited November 2016 ration alnetmagewatto_cobrajony0
  • Reply 6 of 20
    This is such a frikkin' stupidity of a post. Even assuming what it says is true, the article is about one village in one state in India.

    Here, knowledge can be a good thing, if you can process it: India has ~650,000 villages across 29 states (and an additional 7 'territories'). The "villages" don't include the nearly 500 cities where 350M people live. This latter group will be the first set of consumers that are Apple's target market.
    edited November 2016 ration alnetmagewatto_cobraspacerayssree
  • Reply 7 of 20
    lkrupplkrupp Posts: 6,530member
    Wait one goddamned minute here. We were told in no uncertain terms that the iPhone in India would be an even bigger Epic Fail than the iPhone in China. Did somebody lie to us? And since when did we start separating premium sales from el cheapo sales? We need those lumped in so we can keep lamenting the impending doom that is Apple’s destiny.  
    edited November 2016 adamcration alnetmagejax44jbdragonwatto_cobraspaceraysjony0
  • Reply 8 of 20
    lkrupp said:
    Wait one goddamned minute here. We were told in no uncertain terms that the iPhone in India would be an even bigger Epic Fail than the iPhone in China. Did somebody lie to us? And since when did we start separating premium sales from el cheapo sales? We need those lumped in so we can keep lamenting the impending doom that is Apple’s destiny.  
    Apple only grabbed 66% premium sales which most investors believe doesn't count for anything. Meanwhile Android OS grabbed 97% of non-premium smartphone sales in India which weighs heavily in favor of "Android OS" putting Apple out of business. It's like Toyota vs Ferrari. In Wall Street's view, people who own Ferraris are losers because they're in such a small number. The big winners are Toyota users because they belong to the higher market share percentage. Apple being like Ferrari certainly doesn't give it an advantage. Basically the iPhone will be considered a fail in India even if it took 90% of the premium market. Only overall high market share percentages count for anything. Niche market share and profits isn't worth a damn. /s

    You do know that Wall Street is pimping the Google Pixel Phone as pushing Alphabet's market cap well beyond Apple's market cap due to the expected huge boost of Pixel Phone revenue. There are no boosts for the iPhone. In fact, Wall Street is sure the Pixel Phone will eat into iPhone revenue. That's what Wall Street thinks of Apple. Apple is thought of as an oafish loser tech company that will be beaten by ANY company which puts out new smartphone hardware.  It's definitely not looking good for Apple supporters.
    edited November 2016 ration aljbdragonwatto_cobrajony0
  • Reply 9 of 20
    This is such a frikkin' stupidity of a post. Even assuming what it says is true, the article is about one village in one state in India.

    Here, knowledge can be a good thing, if you can process it: India has ~650,000 villages across 29 states (and an additional 7 'territories'). The "villages" don't include the nearly 500 cities where 350M people live. This latter group will be the first set of consumers that are Apple's target market.
    The story is only about 1 village, but I have seen other stories that many men in India are not letting their wives and daughters have phones.  My guess is this extends to the cities, too.  To the extent this is true, the smartphone market in India is not directly comparable to other countries.
    perkedel
  • Reply 10 of 20
    MacProMacPro Posts: 17,835member
    lkrupp said:
    Wait one goddamned minute here. We were told in no uncertain terms that the iPhone in India would be an even bigger Epic Fail than the iPhone in China. Did somebody lie to us? And since when did we start separating premium sales from el cheapo sales? We need those lumped in so we can keep lamenting the impending doom that is Apple’s destiny.  
    You are right.  I remember clearly many stated here categorically that no one in China could afford an iPhone and the Google-Samsung rip offs would win the day.  Isn't history a bitch when you actually hear the truth?  :)
    macxpressjbdragonwatto_cobraspaceraysjony0
  • Reply 11 of 20
    This is such a frikkin' stupidity of a post. Even assuming what it says is true, the article is about one village in one state in India.

    Here, knowledge can be a good thing, if you can process it: India has ~650,000 villages across 29 states (and an additional 7 'territories'). The "villages" don't include the nearly 500 cities where 350M people live. This latter group will be the first set of consumers that are Apple's target market.
    The story is only about 1 village, but I have seen other stories that many men in India are not letting their wives and daughters have phones.  My guess is this extends to the cities, too.  To the extent this is true, the smartphone market in India is not directly comparable to other countries.
    Your "guess" is about as good as bullshit.

    No, I think I am being unfair to bullshit when I say that: the number of cell phone connections (not phones) per 100 population is 81.35. That's over one billion lines. Not phones. 

    Youre re in the wrong forum for FUD, buddy. 
    watto_cobraspacerays
  • Reply 12 of 20
    The key is the last bit about local sourcing. That will be the fly in the ointment for apple's near term aspirations for the indian market. I have my doubts about them figuring it out given the legal morass and logistical nightmares there. Let's not put the cart before the horse.  
  • Reply 13 of 20
    This is such a frikkin' stupidity of a post. Even assuming what it says is true, the article is about one village in one state in India.

    Here, knowledge can be a good thing, if you can process it: India has ~650,000 villages across 29 states (and an additional 7 'territories'). The "villages" don't include the nearly 500 cities where 350M people live. This latter group will be the first set of consumers that are Apple's target market.
    The story is only about 1 village, but I have seen other stories that many men in India are not letting their wives and daughters have phones.  My guess is this extends to the cities, too.  To the extent this is true, the smartphone market in India is not directly comparable to other countries.


    netmagewatto_cobra
  • Reply 14 of 20
    I wonder how Narendra Modi's cash crackdown will affect November numbers. Wealthy Indians stuck with potentially useless bundles of illicit cash have been splurging on luxury goods of all sorts. On the other hand, there is a general slowdown in business velocity expected. 
    perkedel
  • Reply 15 of 20
    lkrupp said:
    Wait one goddamned minute here. We were told in no uncertain terms that the iPhone in India would be an even bigger Epic Fail than the iPhone in China. Did somebody lie to us? And since when did we start separating premium sales from el cheapo sales? We need those lumped in so we can keep lamenting the impending doom that is Apple’s destiny.  
    You are right.  I remember clearly many stated here categorically that no one in China could afford an iPhone and the Google-Samsung rip offs would win the day.  Isn't history a bitch when you actually hear the truth?  :)
    Hmmm...Maybe Apple does know its markets better than people think after all. :) But Tim doesn't know what he's doing and Apple is doomed! :P
    netmagewatto_cobra
  • Reply 16 of 20
    logic2.6 said:
    I wonder how Narendra Modi's cash crackdown will affect November numbers. Wealthy Indians stuck with potentially useless bundles of illicit cash have been splurging on luxury goods of all sorts. On the other hand, there is a general slowdown in business velocity expected. 
    Narendra Modi's demonetization was announced on Nov 8. This story is about sales in October. 

    Wow, what's with all these people dumping on Apple!? Why such cognitive dissonance?
    edited November 2016 watto_cobraspacerays
  • Reply 17 of 20
    jbdragonjbdragon Posts: 1,932member
    It's funny how India has their 30% rule for things and yet trying to get Apple to make some stuff in the U.S. is the end of the world. Maybe the U.S. needs a few of these rules to get jobs back into this country. There's no simple answers, but things need to start changing.
  • Reply 18 of 20
    How does one afford to write (albeit intermittently) for AI and yet still be able to afford to live in SF?    Good luck building your retirement account 
  • Reply 19 of 20
    sreesree Posts: 79member
    jbdragon said:
    It's funny how India has their 30% rule for things and yet trying to get Apple to make some stuff in the U.S. is the end of the world. Maybe the U.S. needs a few of these rules to get jobs back into this country. There's no simple answers, but things need to start changing.
    The US already do.
  • Reply 20 of 20
    sreesree Posts: 79member
    It looks like the "india desk" in the UK and US seem to be primarily manned by Pakistanis. Take some remote scenario from an village in the middle of nowhere and project it as the defining characterstic of the country!!

    These guys need to see the mobile bill I get for my wife's phone every month !
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