Tech Industry

Report: Apple struggling with iPhone in India

Apple is going to sail past its goal of selling 10 million iPhones worldwide this year, but it hasn't really gotten off the ground in India.

Apple's initial foray into India hasn't gone as well as it has around the rest of the world.
James Martin/CNET News

There is a huge market for mobile phones in India, but according to the locals, Apple's iPhone hasn't even made a dent.

That's the conclusion of a long story published by analyzing the first few months of Apple's foray into India with the iPhone 3G. Analysts estimate that just 11,000 iPhones have been sold in India since Apple launched in that country in September, which is probably equivalent to a week's worth of sales at the downtown San Francisco Apple store.

It doesn't seem that Apple ever thought it would make a huge splash in India, allocating just 50,000 iPhones to that market, according to the article. Of the 120 million mobile phones sold in India each year, around 6 million are of the smartphone variety, and Nokia owns the market with between 60 percent and 70 percent market share.

Several reasons are given for the tepid debut of the iPhone in India: price, promotion, and distribution. The authors note that India's mobile market doesn't follow the carrier subsidy model used in most places around the world, and as a result the iPhone is being sold for far more than some had expected after the $199 (9,500 rupees) worldwide price was announced. Still, that doesn't seem to have been the primary reason for the slow sales, since competing phones are priced about the same as the 30,000-rupee 8GB iPhone, although some think that customers thought they would get the cheaper price and were disappointed that it didn't apply to them.

The real reason seems to be that Apple and its carrier partners (Bharti Airtel and Vodafone) didn't promote the iPhone as aggressively as was done in other countries. And distribution in India is a convoluted process involving several different retailers that employ multiple strategies to reach the many different types of customers that are found in India, according to the article.

The article is worth a read for anyone wondering how one of the world's fastest-growing countries looks at the mobile phone market. Considering Apple has yet to make a splash in India, hasn't officially launched in China, and is going to easily surpass its goal of shipping 10 million iPhones worldwide this year, the company would seem to have a lot of room for growth in those two countries next year.