'Cheaper' iPhones may find the going tough in India, say analysts

Apple’s cheaper iPhone model, the iPhone 5c, announced with much fanfare on Tuesday, targets emerging smartphone markets like India and China, but handset consumers in these traditionally price-sensitive geographies, where Asian corporate giants such as Samsung dominate, may not switch loyalties easily, industry observers said.

That’s not all. Even the prices of the so-called ‘cheaper’ versions of the iPhone may prove beyond the reach of the mass-market consumers (read the Asian middle classes), they said.

Himanshu Chakrawarty, CEO of leading handset retailer The Mobile Store, said that at `34,000 (as per latest  `-$ rates), the iPhone 5c, with simple additions like a plastic cover and a choice of colours, appears prohibitive for Indian youth that Apple wants to target. “It will have limited appeal. Thus, the iPhone 5s may pluck up Apple’s margins a little, but will still be nowhere close to Samsung’s sales.”

Not just in India, Apple’s cheaper iPhones may find the going tough in China. “Even though Apple has a lower end iPhone now, its price is still considered mid-end in China and not low-end,” said Sandy Shen, a Shanghai-based analyst for Gartner.

Both the new iPhone models would be launched in the US and Japan on September 20. The iPhone 5s would retail in the US for $649, while the iPhone 5c would sell for $549 apiece.

In China, the iPhone 5c will sell for $200 more apiece than the US retail price of $549. This will likely make a lot of Apple loyalists shy away from upgrading from the hugely popular iPhone 4s, despite the iPhone 5c being a 4G handset.

The case could not be very different for India, where the two models are expected to launch around mid-October, in time for Diwali, mobile industry observers said.

Anshul Gupta, principal research analyst, Gartner, said, “The iPhone 5c, being priced very similar to the iPhone 5, may well be beyond the reach for the Indian mass market. Thus, it is unlikely to boost Apple’s sales in India. For, India is not a market for phones priced over $400.”

Meanwhile, BlackBerry will unveil a new model today, while Microsoft is set to launch its new Surface tablet by October.