iPhone sales surge 56% in India as Apple eats into Samsung's high-end share
With iPhone sales in India up 56 percent year over year, Apple is showing significant progress in the rapidly developing nation, where Chief Executive Tim Cook hopes to find continued success going forward, thanks to the country's massive young population.
Despite established players like Samsung and Intex dominating the largest shares of the Indian market currently, Apple continues to grow, with sales up 56 percent year over year, according to the latest data from Canalys. As second fastest growing vendor in the top ten smartphone providers in the country, Apple has now started to challenge Samsung's dominance in the premium market.
In terms of total market share for devices priced over $300 U.S., Apple has grown from 11 percent in the first quarter of 2015 to 29 percent at the start of 2016. That led to significant losses for rival Samsung, which saw its share tumble from 66 percent to 41 percent over the same span.
"Apple is outperforming the overall market in India, and still has great growth potential," said Canalys Mobility analyst Wilmer Ang.
Apple saw its first-ever year-over-year decline in iPhone sales last quarter, hurt in particular by China, where total sales were off 26 percent. But Apple's Cook believes the so-called "doom and gloom" among investors was a huge overreaction.
Instead, Cook has turned his sights toward growing demand in India. This week, in an appearance on Jim Cramer's "Mad Money," Apple's CEO noted that 50 percent of the population is aged 25 or younger, and those users have shown interest in buying the best products available.
In addition, in Apple's latest quarterly earnings conference call, Cook pointed out how sales in India were up significantly and that Apple would be "placing increasing emphasis" in these markets where there is significant growth.
"With only 42 percent smartphone penetration of the global handset market today, iPhone is still attracting millions of first-time smartphone buyers each quarter, especially from emerging markets. For example, in India our iPhone sales were up 56 percent from a year ago," Cook said.
The rollout of faster LTE networks in 2016 are also expected to offer greater growth opportunities for the iPhone.
Affordability of a premium brand is still a driving factor of sales in a cost-sensitive smartphone market. Apple's total market penetration is still under 2 percent in India. But thanks to numerous price cuts, Apple's iPhone 5s still became the most popular Apple device in India, even with a smaller screen and outdated hardware.
Apple's attempt to further grow this market has faced several setbacks with government bans on importing used iPhones for sale. The company's requests have been turned down twice, indicating both a reluctance on the part of the Indian government to import foreign smartphones in lieu of local manufacturing, as well as opposition from market heavyweights like Intex, Micromax and Samsung.
Canalys, a global intelligence and data analytics company for the IT industry, expects that vendors will begin partnering with financial institutions to make smartphones more affordable and encourage growth in the Indian market.
Despite these setbacks, Cook expressed confidence in Apple's ability to grow its market in India, the third largest smartphone market in the world. While the smartphones in use so far have been primarily low end due to economics and network capabilities up till now, Cook said he sees India like "China was maybe seven to ten years ago" and that "there's a really great opportunity there."
Despite established players like Samsung and Intex dominating the largest shares of the Indian market currently, Apple continues to grow, with sales up 56 percent year over year, according to the latest data from Canalys. As second fastest growing vendor in the top ten smartphone providers in the country, Apple has now started to challenge Samsung's dominance in the premium market.
In terms of total market share for devices priced over $300 U.S., Apple has grown from 11 percent in the first quarter of 2015 to 29 percent at the start of 2016. That led to significant losses for rival Samsung, which saw its share tumble from 66 percent to 41 percent over the same span.
"Apple is outperforming the overall market in India, and still has great growth potential," said Canalys Mobility analyst Wilmer Ang.
Apple saw its first-ever year-over-year decline in iPhone sales last quarter, hurt in particular by China, where total sales were off 26 percent. But Apple's Cook believes the so-called "doom and gloom" among investors was a huge overreaction.
Instead, Cook has turned his sights toward growing demand in India. This week, in an appearance on Jim Cramer's "Mad Money," Apple's CEO noted that 50 percent of the population is aged 25 or younger, and those users have shown interest in buying the best products available.
In addition, in Apple's latest quarterly earnings conference call, Cook pointed out how sales in India were up significantly and that Apple would be "placing increasing emphasis" in these markets where there is significant growth.
"With only 42 percent smartphone penetration of the global handset market today, iPhone is still attracting millions of first-time smartphone buyers each quarter, especially from emerging markets. For example, in India our iPhone sales were up 56 percent from a year ago," Cook said.
The rollout of faster LTE networks in 2016 are also expected to offer greater growth opportunities for the iPhone.
Affordability of a premium brand is still a driving factor of sales in a cost-sensitive smartphone market. Apple's total market penetration is still under 2 percent in India. But thanks to numerous price cuts, Apple's iPhone 5s still became the most popular Apple device in India, even with a smaller screen and outdated hardware.
Apple's attempt to further grow this market has faced several setbacks with government bans on importing used iPhones for sale. The company's requests have been turned down twice, indicating both a reluctance on the part of the Indian government to import foreign smartphones in lieu of local manufacturing, as well as opposition from market heavyweights like Intex, Micromax and Samsung.
Canalys, a global intelligence and data analytics company for the IT industry, expects that vendors will begin partnering with financial institutions to make smartphones more affordable and encourage growth in the Indian market.
Despite these setbacks, Cook expressed confidence in Apple's ability to grow its market in India, the third largest smartphone market in the world. While the smartphones in use so far have been primarily low end due to economics and network capabilities up till now, Cook said he sees India like "China was maybe seven to ten years ago" and that "there's a really great opportunity there."
Comments
Apple's business is banging.. dawg!
The Indian smartphone market grew 12 percent YoY, 24.4 million units shipped. The top five vendors (Samsung, Micromax, Intex Lenovo and Lava) remained the same as this time last year with Lenovo posted pretty impressive growth of 63% compared to last year.
Microsoft, Blackberry, Sony and LG were market-share losers since the Indian market is trending towards low-cost handsets.
Apple, currently #8 in India, did experience the second largest growth and not lagging far behind Lenovo, so there's certainly plenty of room to grow more.
I'd have faith in their outlook over a blogger or analyst.
So the answer is "both"
http://www.cnbc.com/2016/05/05/why-apple-might-not-find-huge-success-in-india.html
But lets face it, those investment insiders are simply trying to get more down/up in Apple's share price.
They make much of their money on the market downs and ups !
Just get your buy order for Apple in to your broker.
You can make a bit more by disagreeing with those market price game players!
Many of their software services are weak to non-existent in india.
- iBooks Store has like 500 books total (all from gutenberg),
- the apple maps is laughable at best with almost no POI information even in tier-1 cities, no navigation, no flyover, no schools, no hospitals, no train stations, you get the picture.. Damn I work out of a huge IT SEZ and it is not even mentioned in the maps. Everyone including me uses google maps (and I am someone who has 100+ accepted corrections/additions in apple maps!!).
- iTunes music is slightly better, but it only really has music from the last 3-4years. most of the old stuff is missing. Also, they only have hindi music, most of the regional music is non-existent (India is like europe with about 100+ languages, but there are about 10 major ones where there are significant music and movie industries).
- I had some hope for iTunes movies with their renting model, but ever since netflix made an entrance a few months ago they have driven everyone else out of that nascent market. I know of no one who rents from iTunes movies any more.
- the penetration of macs is so low here, that the ecosystem advantages are hugely nullified. Good thing is, it is atleast growing. (btw, everyone who has a mac already has an iphone and possible an ipad too).
- Almost everyone who uses an iphone here uses the 'iTunes on windows', and THEY ALL HATE iTUNES!! (haven't yet found any exceptions).
The good thing, there is I think a unanimous consensus that apple has the best quality hardware, and the most responsive UI.
About me - I have been a mac user in india since 2005 when apple made the shift to intel, an ipad user since ipad2 released and finally saved up enough to get an iphone-6 after years of using a cheapo $90 crap-droid phone.
I agree. It's all about demand and offer, cost and profit relationship. The more people buy iPhones in India, the more services Apple open there.
https://en.wikipedia.org/wiki/List_of_countries_by_number_of_mobile_phones_in_use
Also, There are about 400 Million persons in India aged 25 - 50 years old. (The TOTAL US population is about 308 million with only about 102 million between 25 and 50 years old).
So let's assume (yeah, I know what that means) that of those 400 million persons that are definitely in the segment of the population in India who might use a cellphone, only 5% of them can afford an iPhone SE, then the possible market is only about 20 million persons.
Then let's assume that Apple is able to get 25 percent of that, then they would sell about 5 million iPhones a year in India.
Not bad, but not huge and only still about 3% of Apple's total annual worldwide iPhone sales of about 170 million.
However, think that the market in India is much much more than my conservative assumptions above, In addition, keep in mind that India's population continues to grow and its middle and upper class also continues to grow at a high rate.