What Tim Cook needs from India to sell more iPhones in the country

Pranav Dixit May 17, 2016 3 min

Figuring out what Apple CEO Tim Cook wants from India is not difficult. He wants Indians, especially young Indians, to buy more iPhones.

“Almost half the people in India are below 25,” Cook said earlier this year. “And so I see the demographics there also being incredibly great for a consumer brand and for people that really want the best products.”

All that sounds great. After all, young Indians, by some accounts, are already having ₹200 sandwich-lunches at Le Pain Quotidien.

The problem is that when it comes to phones, they are getting by just fine with Android devices that are less than a third of what an entry-level iPhone costs. In fact, 70% of smartphones sales in India are below ₹10,000 according to data from Counterpoint Research.

The result is that Apple has less than 2% marketshare in India. “Apple has always had low focus on India, marked not only by Jobs’ disinterest in visiting here except as a hippie traveller, but by Cook’s zero visits to India versus eight to China,” says Prasanto K Roy, a Delhi-based technology journalist who writes for the BBC. “With its global slowdown, Apple desperately needs to develop the India market, which it has failed to crack so far.”

All that’s changing. Cook is finally set to make his maiden visit to India this week. He will visit Bengaluru and Hyderabad and meet Prime Minister Modi to possibly discuss everything from Apple’s support for Make in India, to bringing up the issue of selling refurbished iPhones after the India rejected Apple’s proposal earlier this month.

We know what Tim Cook wants from India. Here’s what he needs to make it happen.

1. Apple Stores

This one’s in the bag already. Apple Store are coming to New Delhi, Mumbai, and Bangaluru by the end of 2017, according to sources who spoke to FactorDaily.

Having stores in the three largest Indian metros is a great brand-building exercise for the company — Apple Stores in the US are famous for letting people walk in and experience any Apple product they want — but Apple Stores also serves as important points of contact for after-sales support and service of Apple products.

Apple’s premium resellers in India are currently responsible for providing this crucial part of the Apple experience, but nothing will beat Apple doing it themselves.

2. More 4G penetration

In Apple’s latest earnings announcement, Cook directly blamed the lack of widespread 4G adoption in India as a key reason for dismal iPhone sales. Against this backdrop, the timing of Cook’s India visit couldn’t be better.

Mukesh Ambani’s Reliance Jio is currently in the middle of a nation-wide 4G rollout, and Cook is expected to meet RIL officials in Mumbai, according to an Economic Times report. With data speeds many times faster than existing 4G networks and affordable pricing, Jio might be the shot in the arm that India’s mobile internet needs.

Apple could also explore a carrier partnership with Jio to sell iPhones, something that it does as a matter of course in the US, but doesn’t do so in India since Indians rarely buy phones from their service providers.

3. More Indian developers developing for iOS

Since iPhones are such a minuscule minority in India, plenty of Indian app makers and startups often develop for Android first, and often, Android only. For Apple, which pretty much invented the concept of an App Store and now has more than 1.5 million apps, this is a problem.

Apple plans to remedy this by launching an accelerator program for Indian startups, the first time it has done this anywhere. Launching a startup accelerator would encourage developers to come up with ideas for apps that resonate strongly with the Indian market.

4. Being allowed to sell refurbished iPhones

Earlier this month, the Indian government banned Apple from imported and selling refurbished iPhones in the Indian market. For Apple, this was a setback — the company doesn’t drop prices or offer huge discounts on its products, and refurbished iPhones would have helped it crack the price-sensitive Indian market.

Cook will make a renewed push to sell refurbished phones when he meets with Modi, say reports.