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02 December 2023

We're ready, but is Apple?

By David Tusing

When I bought my first iPhone, unlocked, from a vendor on Souq.com two and half months after the official launch in June 2007, it cost me Dh3,500 for the 8GB model. Today, almost two years later, a friend in Bangalore has to (still) shell out about Rs31,000 (Dh2,400) for the real McCoy iPhone 3G with similar-sized memory. Flashback to July 2008 – CEO Steve Jobs announces to the world, with much fanfare of course, the next-generation iPhone. The 3G version, he said, would be priced at $199 (Dh730) for the 8GB globally. At current exchange rates, that's about Rs9,500.

It comes as no surprise then that Apple's iPhone entry into India has often been called the biggest failure of a top brand in recent memory. Quite a shame, considering all studies indicate the country as the fastest-growing handset market in the world. Approximately 120 million devices are sold each year. Why wouldn't anyone want a piece of that?

To be fair, handsets in India have traditionally never been sold by service providers – unlike the United States or some parts of Europe, where they are empowered to subsidise device rates by offering various contracts. So the $199 price attributed to Jobs could not have been offered in India at all. Still there's quite a coulee between Rs9,500 and Rs31,000 wouldn't you say? Besides, India doesn't have 3G yet. So what's the point?

Analysts put it down to a failure in the marketing strategy of both Apple and its two license holders in India. The iPhone maker, they say, has failed to understand the complex retail market of the country it was attempting to break into.

Which is why the iconic phone's impending – and very delayed – launch in the UAE will be interesting. The market dynamics here are unique. The stipulations and provisos the guys from Cupertino have made with etisalat and what they put a caveat against, will impact its performance. Yes, the Emirates and the rest of the GCC have the spending power and the technology. But is Apple really ready for it? Also, the Telecommunications Regulatory Authority's (TRA) strict anti-monopoly stance means that du could get into the game. Although for now, the only official statement it'll give is there is no agreement in place yet. But it's only a matter of time, methinks.

etisalat will most likely adopt the "locked" model where they'll offer a subsidised device, but one that is exclusive to the network. What will set it apart therefore, according to the experts I've spoken to, is in pricing and packaging. Will iPhone service subscribers get cheaper data plans than the operator's current rates? How competitive will the whole package be vis-a-vis grey, unlocked phones?

Those answers will decide the legitimate iPhone's fate in the UAE. Otherwise, one telecom official's proclaimation that the country could have the highest concentration of iPhones in the world, will have to be taken with a pinch of salt.

- What do you think? Email online@business24-7.ae