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Apple to ramp up local manufacturing, retail operations in India: CEO Tim Cook

Apple owns three percent of the overall smartphone market in India, but leads the premium segment.


At Apple’s Q3 earnings call last week, CEO Tim Cook stressed upon the importance of India, and said he’s “bullish” about the market. Given Apple’s slump in China, owing to the meteoric rise of local smartphone manufacturers there, India is a critical cog in the wheel for the iPhone-maker. Its home market US is saturated now, and so are other geographies like UK; hence, the next phase of Apple’s growth that will fuel its global expansion will come from emerging markets, particularly India, which is home to the world’s largest smartphone population.

In an interview with The Hindu, Cook said that the Cupertino-based tech giant would scale up manufacturing in India a great deal in the coming years, and would also look at developing localized features on the iOS – something that would appeal to India’s largely non-English-speaking, cricket-and-entertainment-obsessed populace. Cook, incidentally, is the first Apple CEO to visit India when he toured last year. His predecessor Steve Jobs never came to India in the capacity of Apple CEO. He, however, was said to have been influenced by India’s Yogic culture in his youth. ALSO READ: Tim Cook meets PM Narendra Modi; highlights Apple’s impact on Indian economy, creation of local jobs

Cook said that Apple has already created 7.5 lakh jobs in the iOS ecosystem in India, and is roping in more local developers who can build apps that cater to desi needs. “We are bringing Hindi to dictation. We have brought cricket to Siri… We are also localizing our keyboards within iOS. So we are trying to think through every single way to make the user experience better for the Indian customer,” he noted. In June, Cook was among the illustrious Silicon Valley CEOs who met PM Narendra Modi in Washington, and promised more investment and attention in India.

Currently, there are over 1 lakh iOS apps that have been built by Indian developers. That is a 57 percent growth since 2016. Earlier this year, Apple opened its first App Accelerator in Bengaluru to inspire a new generation of app developers to ‘Make in India’ and build for India. “Apple’s commitment to the developer community through the opening of the App Accelerator is a tremendous investment in the future of India’s digital economy,” NASSCOM President R Chandrashekhar said in an earlier statement. ALSO READ: Apple requests Indian government for tax breaks for its suppliers: Report

Apple holds a three percent share in the Indian smartphone market, which is Android’s largest user-base in the world. Cook is not threatened by Android‘s dominance, and sees it as an opportunity to grow. “Market in India is big enough for several brands. For us it’s about innovation, making best product and making the ecosystem better and better. If we do that well then more people will switch from Android to iOS,” he said. Earlier this year, Apple had reportedly asked the Indian government to extend tax breaks to its suppliers such that it can truly ‘Make in India‘ as opposed to merely assembling its iPhones here. The company started assembling iPhone SEs in India from May.

In June, it sought permissions from the Indian government to start Apple-branded retail stores in the country. At present, Apple products are sold only through third-party authorized re-sellers. India requires companies to source 30 percent of its products from within the country in order to be able to open branded retail stores. Apple is yet to reach that. But, it plans to ramp up retail operations points going ahead. “We are looking at developing the channel and expanding touch points. We are keen on going ahead with our own retail so we are investigating that. We are going to keep expanding,” Cook explained. ALSO READ: How the Apple iPad defied industry trends in a declining tablet market

While price-sensitive Indian consumers might be preferring value-for-money Android handsets over pricey iPhones, Apple has managed to woo a section of the population that is willing to pay for the ‘experience’. Hence, Apple has emerged as the leader in the premium segment. It captured a massive 62 percent of all sales in the ‘over $450’ category, according to Counterpoint Research. This was primarily led by sales of the iPhone 7 which launched last year. There’s excitement building up for the upcoming iPhone 8 already. And Apple is out to leverage it.

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  • Published Date: August 9, 2017 11:52 AM IST