Apple Inc. (NASDAQ:AAPL)
has been well-established in strong existing markets like North America and the European Union, establishing itself as a major smartphone and tablet brand in many developed countries throughout the world. And in many o those countries, the iPhone 5 will available on store shelves over the course of the next 10 to 14 days. However, in order for Apple to generate some real inroads internationally and secure a larger market share away from Samsung Electronics Co. Ltd., HTC or even
Nokia Corporation (NYSE:NOK) – which is having great success with its entry-level mobile phones in emerging markets – it will likely have to find a new model for generating sales. An example of the struggle is demonstrated in India, where more than a billion people live – making it and China the two largest single emerging markets available to retail brands.
The big problem for Apple Inc. (NASDAQ:AAPL) in an emerging market like India is that the price of the iPhone is gnerally out of the reach of many average Indians. Unlike what Apple can do with U.S. wireless carriers – where Apple can charge $200 for its 16GB iphone 5 at Verizon Communications (NYSE:VZ) in exchange for a two-year contract – it does not have the subsidy program in place with wireless carriers in India (such as they are). Apple (NASDAQ:AAPL) has to sell its iPhone at full retail price, which for the 16GB version will run north of US$600 (quoting at north of 40,000 rupees) up to more than US$800 for the 64GB version.
Meanwhile, handset companies like Samsung Electronics Co. Ltd. and HTC have been very successful at adopting affordable pricing in India, and with Apple Inc. (NASDAQ:AAPL) not planning to have the iPhone 5 available in India until probably November (it will be available in Hong Kong and Singapore by the end of September), Apple may again have trouble getting a foot hold in a smartphone market that is expected to grow by 77 percent over the next year. Lon-term certainty for Apple may likely be contingent on the company’s sales success in emerging markets like India and China
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