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Apple Inc. (AAPL) Needs a Bigger Anchor in Asia – The iPhone SE?

Apple Inc (NSDAQ:AAPL) iPhone SE

A few months ago, Apple Inc. was reported to be facing a big dip in iPhone sales. The consumer electronics giant was well aware of the prospect though, and, of course, had no plans on taking the sales plunge sitting down. By the time it had become mainstream news late last year, the tech company was already rumored to be working on its cheaper iPhone. The 21st of March came around and Apple unveiled its first ever mid-range smartphone — the iPhone SE.

The iPhone SE could attract more people in emerging markets such as India due to its competitive pricing. In India, Apple’s accounts for less than 2% of the overall smartphone market. A report from the International Data Corporation showed that the Indian smartphone market is being led by Samsung with a 24% market share.

Apple Inc (NSDAQ:AAPL) iPhone SE

Who is the iPhone SE for?

There are a lot of misguided opinions about Apple’s newest phone range. Pointing at it’s appearance, some would tell you the device was made to draw in iPhone 5s lovers, who appear to stand as a niche cult within the iPhone community. The phone is thought by others to be directed at those who love the iPhone brand but are either put off or intimidated by today’s larger screen handsets. Some have even reported the phone as the ideal teenager’s gift, a great way to give your demanding youngsters an iPhone without breaking the bank.

All of these ideas could hold some truth, but the latter is perhaps closest to the actual. But instead of demanding teenagers, the iPhone SE is expected to cater to emerging markets. Their craving for low cost and reliable handsets is just as demanding as any young millennial though.

Asia could be huge for Apple

One continent in particular that stands to be Apple Inc.’s next big market is Asia. With countries that house populations ranking in the billions, appealing to the gadget-hungry masses of the east could see Apple soaring to new heights.

This month Tim Cook can be seen touring India, said to be getting a good feel of the country. During his travels the Apple CEO attended a cricket game between the Lions and Knight Riders. “It’s so exciting here,” Cook stated sometime during the game, expressing a new found love for the sport.

Perhaps Cook actually cares nothing for cricket, but one thing is for sure: he and his company do need to win India over. Getting a good feel of Indian culture is essential if the world’s most successful company wishes to expand itself in the Asian subcontinent. Though the iPhone’s global sales figure fell for the first time this year the device managed to go up 56 percent in the country, Apple reported.

Quite indicative of Apple’s true interests in India, smartphones as a whole saw a drop in sales around the world. Despite this, India defied the trend and revealed a great hunger for decent handhelds. Apple clearly wishes to fill this void with its iPhone brand. There remains one major problem though; a large portion of India’s population falls below the poverty line. Even the average mid-income household there makes significantly less than the average American home.

Is the Apple iPhone too pricey for India?

So how does a high-end handset brand like Apple’s iPhone expand itself in countries where populations have shallower pockets? Though recognized as a premium handset maker, the iPhone is still beyond the reach of the average Indian. The solution was simple, create a cheaper iPhone, hence the iPhone SE. But it isn’t that simpLe either.

Another problem in the country would be the infrastructure. Fast and reliable connectivity is somewhat of a rarity in India. This presents itself as yet another barrier to Apple Inc.’s success there. Facebook Inc and other tech giants as well are currently in the process of setting up measures to get more of the Indian population better connected. It is clear that the nation stands as the next big consumer of everything, only lacking in some key elements that make it viable for the likes of Apple .

Cook insists that the opportunities offered by 4G networks will boost the adoption of iPhones in India. This may be true, but India is only playing catch up so the growth would be short-lived. The rest of the global market is flat and it won’t take emerging markets to reach the same state.

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