India Ousts U.S. to Become World's Second Biggest Smartphone Market

Friday October 27, 2017 4:06 AM PDT by Tim Hardwick

India has ousted the U.S. to become the world's second largest smartphone market after China, according to a new market research report on Thursday.

Figures aggregated by industry analyst Canalys show smartphone shipments in India in the third quarter of this year rose above 40 million units for the first time, representing 23 percent annual growth.

"This growth comes as a relief to the smartphone industry. Doubts about India’s market potential are clearly dispelled by this result," said Canalys Research Analyst Ishan Dutt. "There are close to 100 mobile device brands sold in India, with more vendors arriving every quarter. In addition, India has one of the most complex channel landscapes, but with low barriers to entry. Growth will continue. Low smartphone penetration and the explosion of LTE are the main drivers."

Samsung and Xiaomi, which shipped 9.4 million and 9.2 million units respectively, accounted for almost half of the total market, with Xiaomi expected to overtake Samsung if things continue. Meanwhile, Chinese trio Vivo, Oppo, and Lenovo also posted strong sales in Q3 2017.

Apple's sales, which were too low to make the chart, still indicated impressive growth, with iPhone shipments more than doubling to 900,000 units compared to Q3 2016. However, the relatively high price of iPhones has so far meant smaller adoption rates despite the introduction of lower-priced devices and discounted older models.

It's also worth considering that Apple only began local production in India earlier this year, while the Indian government has been mulling tax and policy exemptions sought by Apple for setting up more facilities to assemble iPhones.

Apple currently assembles iPhones at plants run by supplier Wistron, thereby satisfying India's requirement that 30 percent of products sold by foreign companies be manufactured or produced within the country. Apple also wants to open its first physical retail store in India as early as 2018, and the company is reportedly looking to open four to five flagship-class stores in the country over the next five to ten years.

Meanwhile, China remains the biggest smartphone market by some margin, with more than 110 million shipments per quarter.

Tag: India

Top Rated Comments

(View all)
Avatar
32 months ago

If they even, just price their products same as in the US. I think, they have a deal.

iPhone X in US: $999
iPhone 8 (Regular) in India: $980

For that Apple has to make the iPhones in India for which Apple negotiating certain concessions(it might eventually happen when Apple builds the capability in India manufacturing iPhones, right now Apple manufacturers low end iPhone 5C in India but later they might start making the latest models as well). Apple product still worth $1000(iPhone X 64 GB) for Apple whereas taxes and duties levied for getting it imported (for Indian market) added to the price tag so much. Even in US various State Taxes the price will be slightly higher (may be between 5%-10%). Excise duty may be the biggest differentiator.
[doublepost=1509107645][/doublepost]

The ASP in India is fairly meaningless to Apple though. Apple doesn't have a unit that sells for less than $350 in India. Where that ASP does mean something is how that average is reached. There are a ton of phones in India that sell for less than $100. There has to be a fair amount of phones above that threshold to raise the ASP to $135. That's where Apple is concentrating.

The problem for Apple in India is retailing and carriers subsidy. Once they work out a proper acceptable revenue sharing methods, they can match US prices and possibly reach over many millions. No one with right mindset would part away so much for electronics in India who are very smart in evaluating costing of products based on its functionality, resale,utility and depreciation etc..

Even in US Apple popularity was initially increased along with career subsidy. Not many in US would pay annual ransom for an electronic good. They are far smarter than than rest of the world, hence Apple adopted that strategy initially. Now they locked the most in the ecosystem, they slowly start demanding upfront payment for the most part or whole device at retail price.
Score: 4 Votes (Like | Disagree)
Avatar
32 months ago
Provides some perspective doesn't it? Should help some understand why Tim has been desperate to penetrate India's market.
Score: 4 Votes (Like | Disagree)
Avatar
32 months ago
Apple does need to make its retail stores happen in India. We’ve had way too many MacRumors forum members from India sharing their service horror stories over the years when they try to get things fixed or issues addressed through resellers. It’s not that the resellers are bad, either. I’ve read some resellers attempting to provide extraordinary customer service. But their hands are tied, at times. So many of the complaints that MR readers tried to help with would have been so easily settled if the Indian customer could have had an Apple Store to go to for help.

I’ve got good friends from India and the picture I get from them of India is that it is a very promising market for Apple. But Apple sells not just phones but it’s whole ecosystem and service quality to justify its prices and reputation, and for that they need to definitely be more present in India. Hopefully India’s government will let that happen.
Score: 4 Votes (Like | Disagree)
Avatar
32 months ago

Are there many apps in the native language(s)?

This seems almost like a Windows Phone situation.

iOS adoption is good with lots of native linguistics apps (but in India people generally accept English Apps but for rural areas are still behind in terms of acceptance of English as the main written and spoken language). There are way too many languages in India but right now Apple is successful in providing linguistic support major ones.

Right now more people buy iPhone in the resale market.
Score: 4 Votes (Like | Disagree)
Avatar
32 months ago
Still not the second most important when most of the phones being sold are extremely low profit budget devices. The US and China are still by far more important.
Would be more interesting to see the capital expenditure of phones by country.
Score: 3 Votes (Like | Disagree)
Avatar
32 months ago

Provides some perspective doesn't it? Should help some understand why Tim has been desperate to penetrate India's market.

Absolutely. India's 1.3 billion people would get any CEO excited!

However... the average selling price of a smartphone in India is around $135

But because of India's massive population... there are still a lot of people who can afford an Apple phone.

I'm interested to see how it all plays out for Tim and Apple!
Score: 1 Votes (Like | Disagree)

Top Stories

Apple Acquires Weather App Dark Sky

Tuesday March 31, 2020 10:22 am PDT by Juli Clover
Apple has acquired weather app Dark Sky, Dark Sky's developers announced today. Dark Sky is one of the most popular weather apps on the App Store, known for its accuracy and storm warnings. Our goal has always been to provide the world with the best weather information possible, to help as many people as we can stay dry and safe, and to do so in a way that respects your privacy. There is no ...

Seemingly Unreleased Version of Logic Pro X With Live Loops Appears on Apple's Education Site [Updated]

Sunday March 29, 2020 7:23 am PDT by Hartley Charlton
Update: Apple has replaced the Logic Pro X image with an older version. Original story follows. A seemingly unreleased version of Logic Pro X has appeared on Apple's education site, as spotted by a Reddit user. The image from Apple's education products page shows a 16-inch MacBook Pro running Logic Pro X, but with a familiar interface that looks extremely similar to GarageBand's Live Loops ...

Bloomberg: Apple's 5G iPhone Still on Schedule for Fall Launch, But Future Products Could Be Delayed

Monday March 30, 2020 2:40 am PDT by Tim Hardwick
Apple's 5G iPhone is still on track to launch within the company's typical annual fall release schedule, according to a new Bloomberg report on filed on Monday. Signs are that Apple's Chinese-centric manufacturing -- of which Hon Hai is the linchpin -- is slowly getting back on track. The next iPhones with 5G wireless capabilities remain on schedule to launch in the fall, partly because mass...

Case for Upcoming Low-Cost iPhone Shows Up at Best Buy With Alleged April 5 Stock Date

Monday March 30, 2020 4:25 pm PDT by Juli Clover
Apple has a new low-cost iPhone in the works, which is supposed to be launching sometime in the first half of 2020. Given the ongoing situation in the United States and other countries, it's been unclear if the device is going to launch within the planned timeline, but there are signs that it could be coming soon. We started seeing cases for the new low-cost iPhone back in early February,...

Testing Brydge's New Pro+ Keyboard With Trackpad for iPad Pro

Monday March 30, 2020 2:04 pm PDT by Juli Clover
Well ahead of when Apple introduced trackpad support in iOS 13.4, Brydge announced an iPad Pro keyboard with a built-in multi-touch trackpad. We have one of Brydge's new Pro+ keyboards on hand, and thought we'd check it out to see how it works with Apple's new 2020 iPad Pro models. Subscribe to the MacRumors YouTube channel for more videos. The Brydge Pro+ keyboard is similar in design to...

Apple's Work on New Upcoming Products Progressing Normally as Employees Adjust to Telecommuting

Monday March 30, 2020 11:58 am PDT by Juli Clover
Apple's development of upcoming products is progressing as usual despite the fact that Apple employees around the world are working from home, according to a new report today out from Bloomberg. Apple is still working on new versions of the HomePod, Apple TV, MacBook Pro, budget iPads, Apple Watch, iPhone, and iMac, all of which could be released "as early as later this year" and have been...

Apple Releases ProRes RAW Beta for Windows

Monday March 30, 2020 9:33 am PDT by Juli Clover
Apple today released ProRes RAW for Windows in a beta capacity (via Mark Gurman), with the software designed to allow ProRes RAW and ProRes RAW HQ video files to be watched in compatible applications on Windows machines. According to Apple, the software will let the files be played within several Adobe apps: Adobe After Effects (Beta) Adobe Media Encocder (Beta) Adobe Premiere...

2020 iPad Pro Teardown Provides Closer Look at LiDAR Scanner and Confirms Incremental Update

Saturday March 28, 2020 9:56 am PDT by Hartley Charlton
iFixit today shared a video teardown of the new iPad Pro, which Apple unveiled earlier this month. iFixit found that most of the internals of the 2020 iPad Pro are the same as the 2018 model, confirming that the device is a relatively incremental update. The most notable new feature seen inside the new iPad Pro was the LiDAR scanner, which measures the distance to surrounding objects up...

Apple Configurator 2 Updated With New Features, Including Support for Restoring Firmware on 2019 Mac Pro

Tuesday March 31, 2020 5:34 am PDT by Joe Rossignol
Apple Configurator 2 has been updated to version 2.12 with several improvements, including support for restoring firmware on the 2019 Mac Pro. The release notes:• Added support for restoring firmware on the 2019 Mac Pro • Allow access to websites using TLS 1.0 and 1.1 • VPN: Configure Provider Designated Requirement for Custom SSL connection type • VPN: Configure network options for ...

U.S. Government Using Mobile Ad Location Data to Track Compliance With Curbs on Movement

Monday March 30, 2020 4:48 am PDT by Tim Hardwick
The U.S. government is using smartphone location data from the mobile ad industry to track people's movements amid the coronavirus outbreak, according to a Wall Street Journal report. Local governments and the Centers for Disease Control and Prevention have received the anonymized data about people in areas of "geographic interest," with the aim being to create a portal of geolocation...