India Turns Down Apple's Request to Sell Used iPhones

[Laserducky]

I'm not sure what more to say, but I know for certain that this thread is going to end up absolutely toxic like the last one.

Apple is still pretty much in business with India, with those who can afford them already owning Apple products or their equivalent alternatives.

Apparently the government isn't really focused on these folks, but more on those who are near poverty and in dire need of jobs. I personally don't even think they can afford even a refurbished iPhone, or even would want too.

Perhaps Apple should refocus only on the millions living in the cities of India, and target the younger demographic, I mean surely with such a large population even that small percentage who can afford Apple products would still be in millions right?

Unfortunately, lots of uninformed bogans out there who are willing to drag countries like China and India through the mud in an attempt to show their knowledge of world global economics or lack thereof so yeah, it's going to end up toxic for sure.

China is THE go-to-place for manufacturing and India is THE go-to-place for outsourced services, as far as costs dictate, which most rational minded global corporations like Apple follow. Quality is a different issue all together.

Sure, India is impoverished and there are plenty of people below the poverty line. And of course, the lack of toilets, cows on the road and other jokes. Nonetheless, there is a burgeoning middle class of young, skilled professionals and they are growing. Its this big market relatively speaking (probably 0.1% of 1 billion) that companies want to target.

Will India reach first world status within the next 10 years ? Most probably not. But it would be foolish to discount it altogether in the present either. Its not quite in the same league as some impoverished, civil war ridden nation (as some here are wont to believe)

Cheers !

 

[jeremiah256]

I question the wisdom of Apple investing $1B in the Chinese Uber rival, Didi, right before you go to a country that wants to compete with China in attracting foreign investment, to push selling used iPhones. Did Apple insult India or am I not reading this correctly?

 

[diipii]

In March, Apple submitted a formal request to the Indian government in relation to selling refurbished iPhones in the country. Today, however, Commerce and Industry Minister Nirmala Sitharaman said that she is "not in favor" of accepting that proposal (via The Economic Times).The decision comes just days after the Indian government decided not to exempt Apple from a local rule requiring that 30 percent of goods sold by foreign companies be manufactured or produced within the country. India last year exempted retailers selling state-of-the-art goods from the rule, prompting Apple to file a new application in hopes of opening single-branded retail stores in India.

Apple is opportunistic about increasing its presence in India, where its market share is estimated to be only around 2 percent. Apple CEO Tim Cook, who visited India earlier this month, said the country provides a "really great opportunity" for growth, particularly after sales in the U.S. and China have slowed. Apple's revenue grew 56 percent in India last quarter, passing the $1 billion mark for the first time.

India has price-sensitive consumers, however, so Apple's inability to sell refurbished iPhones in the world's second most populous country may hinder it efforts to grow in the region. Cook has admitted that iPhones are too overpriced in India, compared to equivalent U.S. pricing, due to local tariffs.

"The duties and the taxes and the compounding of those takes the price and it makes it very high. Our profitability is less in India, it's materially less -- but still I recognize that prices are high," said Cook, in an interview with Indian network NDTV. "We want to do things that lower that over time, to the degree that we can ... I want the consumer in India to be able to buy at a price that looks like the U.S. price."

At least for now, those plans will seemingly not involve the sale of refurbished iPhones.

Article Link: India Turns Down Apple's Request to Sell Used iPhones

Soon India will make its own phones for themselves, then the Chinese, then the rest of the world. Then Apple can concentrate on their computers.

 

[Textime]

Hell, WE NEED THAT LAW here. Apple should be required to make 30% of the goods it sells in the USA IN the USA!!! Sadly, I doubt Apple could achieve 10% of that figure right now.

Long live Ireland says Apple!

But please don't complain then if the iPhone costs you 150$ more.

 

[Col4bin]

Apparently India does not care about potential millions of sales tax dollars. When GDP is in trillions per year. Several million is pocket change. Do you really care about a dollar when you have million dollars?

And Apple combine iPhone, iPad, Mac sales. We have no way to know if Apple includes refurbished products into its sales figure. As far as I know, Apple sells refurbished iPad, iPod, Mac.

OK, I could have easily said billions in potential tax revenue (no way India would hit a trillion on sales of refurbished iPhones), but I obviously don't know the economics behind Apple's plan, nor consumer demand and projected device sell-through. So I conservatively low-balled my estimate and said millions. But, you still understood my main point.

 

[jonharris200]

The big irony is that Apple's refurbished goods are genuinely excellent.

 

[Gasu E.]

Just buy the country already.

"Been there, done that."

- The Brits

 

[groovyd]

I'm in India right now and via my none scientific visual mini-study there are very few iPhones. In the city I'm in any type of Android phone seems to be the most popular.

assuming all those android phones are made in india?

the thing here is this is not the will of the people of India at all but a posturing of the governing class who anyways themselves have palaces for homes with less then 30% of their stuff having been made in India. I am going to guess they all already own Apple products at any price and so this decision doesn't affect them at all except for preventing the commoner from looking as noble in comparison to themselves which is good if image helps keep you in power. The average poor Indian family would love a 'refashioned' Apple product at a reasonable price and in the end everyone wins except oh this lady making postured decisions on behalf of no one.

 

[FieldingMellish]

Maybe Tim will do better by offering overstocked, but new, iphone 4's?

 

[mojolicious]

The average poor Indian family would love a 'refashioned' Apple product at a reasonable price

The poor Indian family won't get a look in.

Looking at 2010 figures, the starting point for an Indian middle class family income is a little over US $5000. That was 31m families, comprising 160m people. Rich families (3m families, 17m people) were considered to those earning over $25,000.

On the above basis I'd say the potential market for smart phones costing north of $200 is at most 25m people: while the bottom end of those middle class families could spring for a single $200 phone, the majority of householders would have more pressing expenditure. You've got to be approaching upper middle class before buying a $200 phone can be done on a whim, and in the top-earning 10m families before owning multiple phones per household becomes a realistic possibility.

 

[itsamacthing]

Marketing is not a universal concept, like laws and buying power. I'm glad they got denied... Apple! DO BETTER!

 

[jdillings]

Cook shouldn't have even gone to India to kiss the government's butt. They are not only very corrupt but have deplorable human rights record and Cook (and Apple) lose any moral high ground elsewhere by continuing to do business with them. Just today, the following was published:

India has 18 million modern slaves—at least five times more than any other country in the world
http://qz.com/695565/india-has-18-m...mes-more-than-any-other-country-in-the-world/

 

[ForkHandles]

Cook shouldn't have even gone to India to kiss the government's butt. They are not only very corrupt but have deplorable human rights record and Cook (and Apple) lose any moral high ground elsewhere by continuing to do business with them. Just today, the following was published:

India has 18 million modern slaves—at least five times more than any other country in the world
http://qz.com/695565/india-has-18-m...mes-more-than-any-other-country-in-the-world/

The report is quite astonishing. Modern slavery in relation to the world I live in is abhorrent.

Your assessment of the systems there still assumes you live in a glass house, you don't!

Both the US and the U.K. have atrocious human rights records. We both regularly see fit to fly abroad and start wars, in the name of justice and democracy, killing people we never met in order to keep oil supplies running.

Those Indian slaves would be 70 times less likely to be in slavery here, in fact there would only be a quarter of a million under our system! Hardly acceptable.

25% of our prison populations are made up of those who grew up in care or had learning difficulties. That's not humane!

The US kidnapped and held without charge suspects in Guantanamo Bay for a decade.

India has its problems for sure but please don't post here under the guise that we are significantly better.

 

[Exhale]

Apple exploit our infrastructure to sell their goods but then divert all of the profits through Ireland. This means that they DO NOT contribute to our economy in a way that they should.

Ding ding ding.

And thats why they refused the Apple Store deal. It doesn't contribute money to the local economy, it extracts money away from it - and in expensive ones at that.

Taxes? There are no extra taxes, consumers would either buy product A or product B - paying the same tax; the difference is that more of it stays in the country by going with option B; the companies that are either compliant with India's foreign companies law - or are locally grown businesses (even better!).

 

[LovingTeddy]

OK, I could have easily said billions in potential tax revenue (no way India would hit a trillion on sales of refurbished iPhones), but I obviously don't know the economics behind Apple's plan, nor consumer demand and projected device sell-through. So I conservatively low-balled my estimate and said millions. But, you still understood my main point.

The problem is that the missed tax revenue can be easily filled with other product.

The sales tax only applies when someone buying something. When they are going to buy, they either going to buy Apple product or other product. Sales taxs will generate regardless if Apple sell refurbished phones or not.
[doublepost=1464726357][/doublepost]

Cook shouldn't have even gone to India to kiss the government's butt. They are not only very corrupt but have deplorable human rights record and Cook (and Apple) lose any moral high ground elsewhere by continuing to do business with them. Just today, the following was published:

India has 18 million modern slaves—at least five times more than any other country in the world
http://qz.com/695565/india-has-18-m...mes-more-than-any-other-country-in-the-world/

I think a country that does not offer universal health coverages to its citizens has not right to point figure to other countries.

Health care coverage should be basic human rights, after all, you need good health before other rights even makes sense. When you have a deveopped nation that has largest military budget but does not want offer citizen universal coverage health care, it is biggest insult to human right.

 

[furi0usbee]

LOL.

a law like that would grind the US economy to a stop.

would grind greed to a stop you mean.
[doublepost=1464735036][/doublepost]

Except Apple does a TON of engineering design and some assembly in the US. This by itself probably equates to more contribution to the economy than needing to build 30% of good there.

Not nearly.
[doublepost=1464735093][/doublepost]

But please don't complain then if the iPhone costs you 150$ more.

If they want to price themselves out of my price range, that's on them, not me.

 

[Crzyrio]

would grind greed to a stop you mean.
[doublepost=1464735036][/doublepost]

Not nearly.
[doublepost=1464735093][/doublepost]

If they want to price themselves out of my price range, that's on them, not me.

All Cell Phone prices would increase by $150 though not just Apple's. So your ok with a subpar cell phone?

 

[kdarling]

Except Apple does a TON of engineering design and some assembly in the US. This by itself probably equates to more contribution to the economy than needing to build 30% of good there.

Probably not.

In 2015, Apple's US revenues were about $70 billion, so a required locally sourced 30% of US sales would be worth $21 billion.

Apple says their Cupertino offices contribute $4 billion a year in both salaries and local purchases. Dunno how much their other, smaller offices around the US contribute, but doubt it's a lot more.

 

[groovyd]

The poor Indian family won't get a look in.

Looking at 2010 figures, the starting point for an Indian middle class family income is a little over US $5000. That was 31m families, comprising 160m people. Rich families (3m families, 17m people) were considered to those earning over $25,000.

On the above basis I'd say the potential market for smart phones costing north of $200 is at most 25m people: while the bottom end of those middle class families could spring for a single $200 phone, the majority of householders would have more pressing expenditure. You've got to be approaching upper middle class before buying a $200 phone can be done on a whim, and in the top-earning 10m families before owning multiple phones per household becomes a realistic possibility.

my 'poor' was a relative term to indicate the pretty much all of the classes in india relative to the rest of the world except the ruling class but certainly including middle class and even upper class and 'rich' as you say those only make $25k which is still considered 'poor' by western standards.