Apple Inc. (NASDAQ:AAPL)’s iPhone 4 was the only phone from the mobile giant that was available for less than Rs. 20,000 (Around $350), in India, and this phone has been withdrawn once again. The iPhone 4 was re-launched by the company, less than four months ago, as per its strategy of pushing the volumes in the emerging phone markets like India in an attempt to protect margins.
Apple would eventually withdraw iPhone 4 from all markets
The iPhone company will no longer continue the production of this model, and no new supplies are being made to the Indian market from the past two weeks, says Economic Times citing three leading trade partners of Apple. The emerging mobile phone markets in India, Brazil and China were targeted by Apple Inc. (NASDAQ:AAPL) and therefore, the company resumed the production and sale of its lowest priced model, iPhone 4, which it had withdrawn earlier.
As informed by the trade partners of the company, the iPhone maker has further plans of withdrawing the product from all its markets across the world. The Cupertino based company had launched iPhone 4 in India with the purpose of expanding the customer base, and it has successfully achieved this by doubling the customer base to more than 25 lakh in the time span of just one year. It is believed that very few users will migrate to other popular mobile phone brands considering the fact that iPhone users are very much brand loyal.
Factors contributing to withdrawal
Apple Inc. (NASDAQ:AAPL) reported that the Average Selling Price (ASP) of iPhone has dropped by $41 to $596 globally, in the quarter ending March. Factors like cut in prices of iPhone 4S and relaunch of iPhone 4 in emerging markets have been the prime reasons for this, as per the analysts. Not only the falling ASP, but also the technical issues with the iPhone 4 OS have led Apple to take this decision.
Toni Sacconaghi, an analyst at the brokerage firm Sanford C Bernstein, had raised a question as how the ASP has been declining at a very high rate post relaunch of iPhone 4, at the quarterly earnings conference call held by Apple Inc. (NASDAQ:AAPL) last month. Tim Cook, the CEO of Apple, however, denied any correlation between the two. He informed that the iPhone 4 contributed a very low single digit percentage of all the units sold and therefore the impact on ASP was not that substantial.