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Report: 8GB iPhone 4 may return to India as entry-level model?

updated 02:00 am EST, Tue January 14, 2014

Would help fight lower-priced smartphones from Samsung, others

The Economic Times of India is reporting that Apple may relaunch the 8GB iPhone 4 into the Indian market as a low-cost iPhone model to battle cheaper smartphone rivals. It discontinued the model following the introduction of the iPhone 5c and 5s, retaining only the iPhone 4S as its entry-level model. If the report is true, Apple may price the relaunched iPhone 4 as low as 15,000 rupees (roughly $245 US) after trade-ins and other incentives.

The move is said to be in consideration to fight back against lower-priced (but lesser) smartphone models from an array of competitors, including Samsung. The company is said to be losing marketshare in India in what constitutes the country's "middle segment" between featurephone users and those wealthy enough to easily afford premium smartphones. Previously, the 8GB iPhone 4 sold for Rs 26,500 ($430 US) but a variety of trade-in, rebate programs and extended payment options could lower the upfront cost of a relaunched iPhone 4 to something more affordable.

In part, the problem comes from both the higher prices of iPhones in India (a base-model iPhone 5s, for example, sells for $870) and in the lower average income in the country (currently around $3,600 per year in US equivalency). Should Apple restart production on the iPhone 4 for the Indian market, it would initially supply stores with unsold inventory of the recently-discontinued model from around the world, according to the report, before remanufacturing new ones. The strategy, if successful, might also be adopted for other poorer nations as well (including China and Brazil, the latter of which being the country most likely to be picked to manufacture any new iPhone 4 units).

"While there is still a latent demand for the iPhone 4 due to its attractive price in India, the model has lost favour in matured markets, and hence it may not make sense for Apple to start fresh production since it follows economies of scale," said an unnamed senior executive at a top electronic retail chain in the Economic Times report. Presently, Apple does not offer a model of iPhone priced below Rs 30,000 ($490), and Indian carriers do not offer subsidies like those seen in North America and elsewhere. The iPhone 5c, speculated by many prior to its launch as the company's mid-price offering, is deemed to expensive for the middle demographic in India.

"Apple's iPhone 4 8GB model used to rank amongst the top three selling models by unit sales and fight neck and neck with Samsung, but with its exit the company lost much ground," said the same executive. He added that the iPhone 4 accounted for between 15-20 percent of smartphone sales, compared to Samsung's 50 percent across all models in the Rs 15,000-20,000 segment when it was available. Now, he says, Samsung has 70 percent of that bracket.

Apple is said to have "sounded out" its leading distributors in India about the idea of a relaunched iPhone 4 8GB model. Since it has unsold inventory on hand, sources said, it could supply stores with inventory of it as early as next week, possibly in time for India's Republic Day shopping event.

by MacNN Staff



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