Mumbai: In keeping with its pre-launch hype, and, as widely-expected, Cupertino-based Apple Inc. on Tuesday launched two new iPhones—a high-range iPhone 5S and a mid-range iPhone 5C, while breaking from its tradition of showcasing a single new iPhone model at a time.
The slightly cheaper iPhone 5C would help in improving Apple’s smartphone prospects in India where it has less than 4% marketshare, albeit with fewer models than its competitors.
The Indian mobile handset market, according to a 20 August report by Voice and Data, a CyberMedia Ltd publication, posted a 14.7% rise in revenue at Rs.35,946 crore in fiscal 2013 compared with Rs.31,330 crore in fiscal 2012. This was mainly due to the increasing uptake in smartphones by the Indian consumers.
The devices will run on the new iOS7 operating system, which will be available from 18 September. The iPhone 5C’s back and sides are made from a single part and contain no joints or seams. It comes with colour-matched wallpaper.
The back is made from a hard-coated polycarbonate. Its inside is built with a new steel-inforced construction method with a 4-inch retina display. It has got an 8-megapixel rear camera and comes in five colours—blue, white, red, yellow and green.
The 5C is powered by an Apple-designed A6 chip. The 16GB model is priced at $99 and 32GB for $199 on a 2-year contract.
The 5S, on the other hand, is powered by a 64-bit A7 chip, the world’s first and only such CPU in a smartphone and, of course, a better camera. “The A7 is up to 2x as fast as the previous generation of CPUs, and handles graphics up to 2X faster,” according to the company.
The company has not declared any India pricing for either of the models.
iPhones have always served Apple well. The company sold 31.2 million iPhones, a record for the June quarter, compared with 26 million in the year-ago quarter.
Next month Apple will ship 700 millionth iOS device, Cook said. (Google just said it activated its 1 billionth Android device) According to a 29 August research report by International Data Corporation (IDC), the Indian smartphone market almost tripled its shipments in the second quarter (April-June) of 2013 from a year earlier.
Vendors shipped a total of 9.3 million smartphones in the second quarter of 2013 compared with 3.5 million units in the same period of 2012. It was the 5-6.99 inch screen size smartphones, or phablets, that grew 17 times from a year ago. Moreover, the phablet share rose to 30% of the smartphone market in the June quarter.
According to IDC, Samsung maintained its leadership spot in the June quarter in the Indian smartphone segment with a 26% share. Cash-backs and zero per cent interest equated monthly instalment (EMI) schemes only helped its cause.
Micromax stayed steady at No. 2 spot and crossed the two million units mark in shipments with a 22% share. The smartphone shipments for Karbonn have also increased steadily over the last quarter, and it now has a 13% share. With Nokia’s decision to discontinue symbian devices, the entire focus has shifted to the Lumia range of smartphones. The Finnish handset maker had a 5% share in the Indian smartphone market in the June quarter, tied up with Sony.
Apple Inc. has a 3.6% market share in India but also the smallest number of handset models in its portfolio.
“The most exciting entry into the Voice&Data Top10 table in the handset space is the iconic Apple that grew a mammoth 417.2% to post revenue of Rs.1,293 crore in FY13 compared to Rs.250 crore a year back. Though India was never a focus market for the Cupertino-based smart device maker till Steve Jobs’s era, in the last two years Apple has started making inroads, though slowly,” said the report.
In the last fiscal, Apple made some disruptive changes in its sales strategy that have paid off. Appointing Ingram Micro and Redington as the national distributors for their entire sales, and offering EMI schemes to the consumers to buy the most coveted Apple product changed the game for them.
According to a 12 June note by Jack Kent, principal analyst for mobile at IHS, an information and analytics provider, Apple’s innovation is usually not with the introduction of new features, but rather comes from the execution and integration of features as part of a whole new experience for users.
“None of the devices that Apple is celebrated for—the iPhone, iPad or even the iPod—were the first of their kind when they were introduced, but they’ve so thoroughly remade the market since their launch that they’ve become category definers and market leaders of their individual segments,” said Francis Sideco, director for consumer electronics and communications technologies at IHS.
Also, Apple’s iOS7 design is important because Apple can now do updates to iPhones on all carriers at once, said the 12 June IHS note. Unlike Android devices where updates have to be staggered over a period often extending to months because of the disparate models and various software versions in existence, an iPhone update means existing Apple users benefit at the same time.
App developers will also very quickly have a large base of iOS devices running the new features, and will have even more justification to innovate their own apps quickly than on Android devices when there is a new Android release, the IHS note added.
Meanwhile, the losers in the pack are Nokia and BlackBerry.
In the December quarter of 2011, BlackBerry Ltd (formerly Research in Motion Ltd) had a marketshare of about 15% in India when the smartphone base was around one million, according to research firm Convergence Catalyst. Now its marketshare is around 2% or even lower, according to industry estimates.
Nokia, on its part, called it quits on 3 September and announced the sale of its entire devices and services business to Microsoft Corp. for around $7.2 billion—lower than the $8.5 billion that Microsoft paid for Internet telephony service, Skype, and much lower than the $12.5 billion that Google Inc. paid to buy Motorola’s mobility business.
Nokia, too, has steadily been losing steam both globally and in India. According to the 18th annual survey ‘Voice & Data 100’ report, released on 20 August, the biggest surprise of the year was Korean electronics maker Samsung dethroning Nokia as the top seller of mobile phones.
Nokia’s Lumia series of smartphones that had witnessed huge growth globally in the initial phases could not draw much attention in India. The rise of smaller local players such as Micromax, Karbonn, Lava, and Zen is a clear indication that consumers want cheaper feature rich phones, the report said, noting that homegrown handset company Micromax captured the third position with 8.7% share followed by Karbonn Mobiles with a 6.4% share.
By 2016, smartphones will account for more than two-thirds of mobile phone shipments, according to IHS. The most basic phones will account for just 4% of the market by then, with feature phones representing 28% of shipments.
According to a 4 March IDC research note, more smartphones are forecast to be shipped globally than feature phones in 2013, the first such occurrence in the mobile phone market on an annual basis. Vendors, the note added, will ship 918.6 million smartphones this year, or 50.1% of the total mobile phone shipments worldwide.
India is set to become the third largest market for smartphones in four years, according to IDC, with phone makers launching more affordable 3G handsets and looking to tap buyers in small cities and towns.