Aug 29, 2008

Business - iPhone gets lukewarm response;India

The much hyped iPhone has so far received a lukewarm response from Indian consumers. According to industry estimates, both Bharti Airtel and Vodafone Essar have not been able to sell more than 1,500 phones in the first week of launching the product.The primary reason for the slow pick- up is the pricing. At a minimum price of Rs 31,000, the iPhone is beyond the reach of most mobile enthusiasts in the country who are now waiting for the operators to reduce the cost. While both Airtel and Vodafone said it was too early to give out the official sales numbers, industry sources indicated that the operators might have sold 50-60 phones per store on an average on the first day, which has since petered down to an average of about 10. Expecting a drop “Whatever the operators could have milked out during the initial burst, normally associated with similar big ticket launches, seems to have been done. The next wave of uptake could come after a price cut because most consumers are probably expecting one going by the experience in other markets where the iPhone was launched,” said a market analyst. In countries like the US and Japan, operators dropped iPhone price by a whopping 50 per cent within a few months of launching it. The price drop, however, infuriated those who paid $599 (Rs 25,000) for the iPhone around its launch. Globally iPhone now costs between $199 (around Rs 8,000) and $299 (Rs 12,000) depending on the model. In some countries, operators are offering the iPhone bundled with a connection for an initial cost of just €1 (Rs 65) and a monthly rental of around €70 (Rs 4,500). In Japan, for example, iPhones are available for a monthly fee of just Rs 1,100. Mr Naveen Mishra, Analyst, Communications Research, IDC India, said, “iPhone’s limited availability through a binding service contract with Vodafone/Airtel and its premium pricing are likely to restrict market penetration in the near term. This could be similar to the experience that RIM faced when it launched Blackberry devices exclusively with Airtel.”

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