How Internet came to Pakistan; Apple’s troubles in India

In case you missed it, I was on Internet History Podcast last week discussing how the Internet came to Pakistan. The interview is more of a personal journey than an exact sequence of events. And it came out a lot better than I expected. I was nervous going into it because 1) it was my first podcast recording and 2) Brian is one of my favorite podcasters of all time. I have listened to every episode of both Internet History Podcast and Techmeme Ride Home. I don’t know if I can say the same about any other. And I am definitely looking forward to his book. While anybody could have done these podcasts and I would have heard them because of the topics. I am not sure I would have stuck for that long.

I learned that interviewing is an art form. You can prepare all you want but at the end, it’s more about what the other person can get out of you. Brian is certainly good at it. You can listen to the podcast on iTunes, Overcast or YouTube. I sound better if you listen at 1.5x.

Apple’s troubles in India

From ET Tech:

Apple could be staring at its toughest year in India in recent times, given the sharp fall in shipments in the first half of 2018, as the effects of the company’s change in strategy to chase profitability rather than growth by cutting discounts and distribution channels comes into play, say analysts.

The Cupertino-based smartphone maker recorded a sharp 55% fall in the April-June quarter on-year and a 30% drop sequentially, on the back of an equally bad January-March quarter, where shipments fell 22% on-year and 46% sequentially, as per estimates from Singapore-based Canalys.

Apple sold 1.8M iPhones in India in 2015, 2.8M in 2016 and 3.2M in 2017. As you can see these are not inspiring numbers. But they were growing. 2018 is worse because the company has only been able to sell 850K iPhones as of now. There can’t be any other explanation than it’s a market problem. Despite the fact that India is a huge market there aren’t many people who can afford an iPhone X. But what about the iPhone 8, 7 and especially 6—which is being locally manufactured in India?

What you need to understand about markets like India and Pakistan is that smartphone is more a status symbol than a utility. While SE and iPhone 6 might work in the US because of pure utility reasons. They are not going to work in India because people really want to talk and brag about what they own. It’s far more easy to brag about iPhone X than its predecessors. And if you can’t afford one then a top of the line Samsung J or Prime series is a better brag than a three-year-old iPhone. It does not matter if the three-year-old iPhone is still a better phone overall.

The closest market, where Apple had a success, is China. The major difference between China and India, however, is the size of the middle-class segment. There are a lot more people who can actually afford an iPhone X in China than they are in India. I don’t think opening a retail store in India is going to solve any of the problems. The allure of the iPhone is still there. It’s a matter of affordability. There are no easy answers here, even for Apple, considering the fact that Apple is not going to make a low budget iPhone.