Apple keynote did not impress analyst, but can it woo the Indian user?

Analysts say Apple users will likely hold on to older models in India as the enthusiasm for Apple products has never been stronger. iPhone 13 goes on sale in India on September 24

Many who were waiting with bated breath for the much-awaited launch of iPhone 13 were in for some disappointment. Without any major announcements and all the new features appearing to be mere upgrades of the iPhone 12, the tech community in India seems unimpressed. iPhone-maker Apple, Inc. showcased its product line-up at the annual keynote on September 15. It launched iPhone 13 with a faster chip and better camera, and refreshed versions iPad Mini and Apple Watch.

Analysts say that Apple users will likely hold on to older models in India as the enthusiasm for Apple products has never been stronger here. iPhone 13 goes on sale in India on September 24.

Apple in India recorded its best quarter so far in April-June 2021. According to Counterpoint Research, Apple’s smartphone shipment here grew 144 per cent year on year in this period, and Apple reigned supreme in the premium smartphone category (over Rs 45,000) with a 49 per cent market share.

To put things in perspective, Apple’s share in the overall smartphone market in India remains sub 5 per cent; Xiaomi leads the pack with 28 per cent. However, latent demand because of the pandemic worked in its favour, says analyst. In January-March 2021, overall smartphone shipments grew 23 per cent to 38 million units, and H1 2021 saw the highest smartphone sales ever, according to Counterpoint.

“Within the premium segment, while all the price bands saw growth, the highest growth, about 182 per cent year on year, was seen in the ultra-premium band. This was mainly due to the strong momentum of the iPhone Pro Max and iPhone 12 Pro,” said Varun Mishra, senior analyst at Counterpoint.

Analysts point out that the shift towards buying premium phones could be due to the work-from-home syndrome and people preferring to use their handsets for entertainment as well, but justifying the cost that Apple is charging for iPhone 13 is slightly overrated. Several pointed out that the iPhone 13 is all about minor upgrades to iPhone 12. The difference is only if you are buying iPhone 13 Max.  Besides the focus on increasing storage or improving on camera is something that the Android universe is used to when it comes to buying the latest phone, and hence buying an iPhone 13 for a price point that is available in India looks a hefty choice.

Apple devices are expensive, which is a big deterrent in its effort to crack India sales. The new iPhone 13 Pro, for instance, will likely be priced at $1,630 (Rs1,20,217), a steep jump from the $999 price tag in the US.

Apple India did not immediately respond to a request for comment.

Apple and iPhone enthusiasts will side with how the company is trying to bring the costs down, Apple has doubled down on local manufacturing and direct sales. Between Foxconn and Wistron, Apple produces 70 per cent (by value) of phones sold in India locally compared to 30 per cent two years ago. The two vendor-manufacturers are also on track to achieve investment and sales targets to secure cost benefits under India’s newly launched production-linked incentive scheme. But how much of this will make a dent in the price of iPhone 13 is yet to be seen.

Apple India saw 29 per cent jump in revenues at Rs 13,756 crore in FY20, according to filings by the India-registered entity. At a company level, Apple does not break down sales by country; India is part of “Europe” which “includes European countries, India, the Middle East and Africa”. Europe sales in nine months ended June 26 were 35 per cent higher at $282 billion, “due primarily to higher net sales of iPhone, Services and Wearables, Home and Accessories,” according to company filings at the US Securities and Exchange Commission.