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Saturday, September 19, 2020

Our Own Devices

Nandagopal Rajan and Shruti Dhapola, who handle Indian Express Technology, host this new weekly podcast which goes beyond the trends so you can stay ahead of the curve. Our Own Devices discusses quirky gadgets, dissects trends and reflects on the world of tech in India.

Episode 15 February 8, 2020

Unpacking Apple: What lies behind its success in India

What works towards Apple’s success in India, a country where most can’t afford its products? On this episode of the tech podcast, hosts Nandagopal Rajan and Shruti Dhapola dissect how the brand’s value proposition, pricing structures, products like the Apple Watch, AirPods and Apple HomePods all work towards a brand that should not be underestimated.
TRANSCRIPT
Shruti Dhapola:
So when it comes to Apple, in India there’s always this hue and cry that the products are way too expensive. But if you look around these days, everyone seems to have them. I think the most popular Apple products right now that at least I see everywhere are the Air Pods but as Apple’s own results show- the new iPhone strategy has really worked for them. It’s the iPhone 11 that has helped them get to record numbers again, and the iPhone 11 is not what you’d call an affordable phone by any stretch of the imagination.

Yes, it’s certainly more affordable than say the Pro variants but it is certainly an aspirational phone. So we’re going to be looking at Apple this week. We’re going to start looking at each of the big smartphone brands on this podcast- what their strategies have been and how they’ve played out.

And as always, it’s me Shruti Dhapola and Nandagopal Rajan on Our Own Devices for Indian Express podcasts. So Nandu let’s start with Apple’s latest results. What stood out for them? We know of course, it’s the iPhone 11. But how do you think this overall strategy has worked out? Because we’re still waiting for the so called cheap or the affordable iPhone.

Nandagopal Rajan:
That’s not coming, but you have a cheap iPhone or many cheap iPhones you can buy.

Shruti Dhapola:
Yes, the older ones.

Nandagopal Rajan:
The older ones. So that is a strategy. They’re not going to come up with a cheaper iPhone. They did the SE, but I’m not sure they will do it again. There’s a lot of buzz around the SE 2 or the iPhone 9 as they’re calling it. iPhone 9 doesn’t make sense to me. Why would they call it iPhone 9 when they have already done a 10?

Shruti Dhapola:
Yeah, they would be going back a number which again, doesn’t make any sense.

Nandagopal Rajan:
But let’s look at what’s in worked for Apple this time. So the numbers say that Apple has done its best numbers in any quarter in India and Apple as a company. iPhone has been available in India from the first version, right? So these numbers are pretty significant.

They are just under a million, which is not too big when you consider what a Xiaomi does, or Vivo, or Oppo. But it’s quite big and almost, I think a lakh more than what Apple has ever done before in India. But the interesting thing is, Apple might actually be making more money than these other guys who are selling 18% or 20% of the market. So that is the interesting thing. Apple’s value proposition or revenue per piece is so high compared to the budget players who will do volume but might not have value.

Shruti Dhapola:
Yeah, we know the iPhone 11 has done well. But I think one other thing that Apple did unique in the strategy was that the iPhone 11’s 128GB version, when it launched, it was not immediately a 10,000 rupee markup. It was actually a 5000 rupee markup, which would have made sense to a lot of people, because they would have been like “Hey, why should I pay 64 for the 64GB version, when I can get the 128, under 70?”

And then there’s also the iPhone XR, which is actually continuing to sell well, because some people are now able to get it under Rs. 40K. Of course, this is with lots of exchange schemes and you know, cashback offers that have been clubbed together. So yes, the iPhone I will say is still a very premium product in India. But again, it’s managing to at least get the customers that who don’t want to maybe pay for an iPhone 11 Pro, and are okay settling for iPhone 11. And the iPhone 11 wasn’t a bad phone either right?

Nandagopal Rajan
It is a good phone.

Shruti Dhapola
Yeah, but I’m talking simply in terms of filler specifications, because people tend to say that “Oh my God, why are the three cameras on the Pro?”

Nandagopal Rajan
So Apple has thought of this completely differently. And maybe that thinking starts with the last series of phones? They bought an iPhone XR, not as a cheaper phone, but as one version of their main offerings. So you XR, you had Xs and you had a XS Max right? So you have three phones. But the iPhone XR pretty much had the same innards as the other two phones. So if that is the base model, then you have phones that are improving on the base model. So it is like a lot of people don’t want to pay for the cameras. A lot of people don’t want to pay for the extra battery life. A lot of people maybe don’t want a larger screen. So why do they have to pay for it?

So it’s like you buy this thing if you don’t want two cameras, right? You get one good camera, but it’s a very good iPhone camera. And the rest of the phone, the core things like the processing power is the same as the other two phones. And that strategy worked. The iPhone XR was cheaper than the other two, but it was not really cheap. That strategy worked really well, especially when the XR towards the end of the year started coming out cheaper in markets like India. And that’s really helped them, you know, rake in a lot of numbers.

Now, what Apple has done with the iPhone 11 is that the iPhone hone is 10,000 rupees cheaper than iPhone xR, which was cheaper than their other phones. Right? So they knew that strategy work, they went ahead and push that strategy even further. But look at it the other way. 64,000 is what you would pay for the premium Samsung phone. Right? And this is their cheaper version. And that is getting picked up. So that is where people are saying, hey, if I can buy an iPhone, why don’t I buy the iPhone? Instead of thinking where can I save 5000 rupees?

Shruti Dhapola:
Yeah, and that’s I think the value that Apple has also been able to create for itself in India because if you look at the exchange values for older phones and iPhone is any day going to fetch you a much higher price value. In terms of sheer numbers I’m saying, than say, a One Plus or even a premium Samsung device. Like six months down the line, everything’s price is probably half of what you paid but the iPhone is still getting you a decent cashback or exchange. And that I think also matters to a lot of users who might want to upgrade say in the next two years or three years.

Nandagopal Rajan:
And this also helps with the refresh cycle or the loyal user, right? Like my wife just sold her iPhone 7, and bought a XR. And she got it for under 40K, as you said, because she was selling an iPhone 7. If she had an Android phone, she would have got 2000 rupees for it. So you know, it also makes value in the system where he you are thinking, I need to have an iPhone. So whenever I upgrade, I’ll get the maximum I’d get for any smartphone at that given point of time. And that’s something Apple has worked on really well. So the fact that Apple is not reducing the value or the price of its products means that there is value in the long run also. So even two-three years down the line, I would say there is no other phone that would get you a Rs. 6000-7000 buy-back in India.

Shruti Dhapola:
And there are very few phones which have been upgraded to say the latest version of the operating system which Apple is done consistently.

Nandagopal Rajan:
It’s usually about 95% on the latest version.

Shruti Dhapola:
Yeah. And what we’re hearing is that it will continue to support even the existing phones right now. Once the next version comes out or at least some variant of it is announced in June, Apple usually releases the next version of iOS in September.

Nandagopal Rajan:
The other interesting thing Apple is done is that, you know, while the phones are not something that everybody can afford, other products from the company are becoming more and more affordable. And you wouldn’t look at it this way. But look at Apple Music. A lot of people who have never used an Apple product ended up buying Apple Music because at that point of time, it was among the cheapest and maybe the best music service you can buy for that price. And that opened up a lot of people to Apple services. And then you see there is a differentiator here when it comes to the services they provide.
And that is also bait for people to maybe move to other products from the company.

Shruti Dhapola:
The Air Pods, I think, are one of the most popular devices from Apple. Even in India, the number of people I see using the Air Pods in a gym. And these are by the way, not Air Pods designed to be water resistant or sweat resistant and. There’s so many people just using them because these are the most convenient devices. They work with every phone. And they work in every situation. And they work flawlessly most of the time.

Nandagopal Rajan:
So a lot of things you buy for the gym are not something you would want to use in the office while taking a call. But the Apple Air Pods sort of fits into all scenarios where it does not stick out as something that’s awkward.

Shruti Dhapola:
Yeah, it doesn’t look like oh my god this is has to be for the gym only. I can’t wear them anywhere else. The Apple Watch itself. I think a lot of the high end iPhone users have converted themselves to the Apple Watch. They’ve gone ahead and chosen this accessory and it remains the best seller in the market because I don’t think anything has come even close to it. It’s just so convenient. And I’ve used quite a few smart watches and fitness bands for review. And I’m sure Nandu is also used quite a fair bit.

Nandagopal Rajan:
Did you say fair bit or Fitbit?

Shruti Dhapola:
I knew you were going to make that pun as soon as I said it.
So yeah, that’s the thing with the Apple Watch. And in fact, I used to think like, three years back that you didn’t need an Apple Watch. Then I borrowed one review unit from you. I used it and I was like, okay, I need the Apple Watch.

Nandagopal Rajan:
So it’s become a way of life for somebody like me. I’m diabetic, I need to look at a lot of indicators in my day to day. So I’m the real quantifiable self right? My diabetologist actually looks at the time I wake up and factors that into my sugar level at the time. And after looking at that sleep study, which I’m getting from the Apple Watch, and comparing it to my sugar levels, I have a lot more insight. My doctor, who is anyway very tech savvy, and, and he has a lot more insight on the kind of medication or what kind of insulin I should take. So often when you are testing your sugar levels, it does not correspond to where it should be. So (with the Apple Watch) a lot of people are getting these kind of insights because you have a very powerful computer on your wrist right? And even things like fall detection at all I think is very, especially for older people and how you can keep track of them. So those kind of things are very interesting.

Shruti Dhapola:
Yeah, the Apple Watch is truly become, you know, I know it was like a lot of people were very unhappy a lot of at least my friends who were hardcore Apple fans are like why is the watch not round? And we see so many coming up which looks suspiciously very much like the Apple Watch.

Nandagopal Rajan:
See people don’t realize this is the most sold watch in the world right now. Not even smartwatch. Apple, I think overtook Rolex about a year ago and it is the most popular what’s in the world right now? The Air Pods are the most popular earphones in the world right now, people always look at iPhone, but see all the other things that they do.

Shruti Dhapola:
We also talked about services in India, we’ve noticed their services are actually priced much lower. If you notice, it’s the reason I think Apple Music is not 99 rupees a month, it used to be 120, which is again because of the competition from its beat. Yeah, it’s made. But that’s also one of the reasons I think a lot of iPhone users are not going to cancel the Apple Music subscription because it just especially if you’re someone who is not only listening to say Hindi or regional music, I think Apple Music does have barely even iCloud is much cheaper here than rest of the world, right? I don’t know about that.

Nandagopal Rajan:
You know, people, some are very hesitant to pay for cloud storage

Shruti Dhapola:
Cloud Storage is but there’s someone in our team who keeps saying that he’s run out of Gmail, but refuses to pay for Cloud Storage.

Nandagopal Rajan:
So I pay for Google I pay for Apple and I also pay for Dropbox.

Shruti Dhapola:
Oh, you still paying for Dropbox?

Nandagopal Rajan:
I don’t know why, but I do.
So the other interesting thing where the cheaper iPhones, right, he spoke about the iPhone SE, but a lot of people are actually experiencing the iPhone first from older devices. And again, it’s a bit of a kind because even if you use an older device, you see the value and then you want to move up the value chain. So the next time know if this time or this year, you’re buying a phone that’s maybe four years old, because it’s very affordable for you. Next time, you might buy a phone that is two years old or a year old, and you’re paying slightly more than what you would have paid last time. And I’ll give you the example of my wife, who bought the iPhone seven around the time the iPhone 10 was coming. And when iPhone 11 has come she’s moved to the iPhone xR which is just a year old, you know. So this is the progression and you move closer to the current model. Right. And again, the arbitrage between the older phone and the new model. That’s gum, the price differential also goes down as you go up the value chain, and you want to move to the the older phone. And Apple has had problems with this, it’s not really been able to sell the newer devices in comparison to the older devices. And I think that is where iPhone Levin has really helped them sell the current device more than the older devices.

Shruti Dhapola:
But let’s also talk about the you mentioned the cnse was kind of a hit in India because I know a lot of friends went out important especially when it was dealing say under 30,000 under 20 at times the iPhone SE two i mean do you think it should happen or it’s like something that happens called escape because there’s a lot of buzz and chatter around it because it apparently will have the design of the iPhone eight, slightly bigger screen, it will still have a high end processor which is the eighth it will have the a 13 processor so it won’t compromise and an apple could be targeting you know the iPhone six your iPhone SE users who may have you know, an older device and they want to get the latest features. So Get them onto the SE to do what he what I

So as you said it’s not very clear who is going to target right? See for me an iPhone SE buyer will be a person not looking at the price that much because you have pretty much have an Apple device available at let’s say every 510 thousand. Right now you can buy the iPhone seven you can buy the iPhone eight, you can buy the 10 s you can buy the 10 are the price points are pretty much covered now and I don’t think if an iPhone SE two comes it will come for less than 30 k if it comes at that price point. So you already have options there. iPhone xR is a pretty good phone if iPhone SE two comes at under 40 it will not come with maybe the latest a 13 chipset right might not be possible. I don’t know whether it’s possible for Apple to do that. And then again, that puts pressure on the iPhone 11 if you do that, like so I don’t see a possibility there from a price point. Now the other possibility is to offer the iPhone as he sighs which a lot of people really want I see a lot of people still holding on to the iPhone five form factor because they really like a phone that they can grip in the hands. And you actually don’t have a lot of phones like that in the market, right? So the under five inch screen size still has a lot of value for a lot of users. That could be a good selling point for this phone. But again, if you’re saying it’s going to look like the iPhone six, then it’s not going to know you’re gonna look like the iPhone eight. So the SEC was actually four inches screen, which is which would Apple stuck to a long time when they didn’t want to? And when they finally upgraded with the six to the 4.7 inch and the 5.5 inch displays,

Shruti Dhapola:
But I still have people ask me Hey, when’s the iPhone SE two gonna come out because a lot of people are still waiting to upgrade. And you’re right. A lot of people don’t want phones which are like six inches screen and seven inches cream. And they want a spoon which is say under five inches and easy to use, you know,

a phone that is smaller, but is not exactly cheaper. If it does come and I think that is now looking at Apple over the years. I think that’s where they might see the value. I don’t think they actually need a cheaper phone right now. Yeah, because the iPhone xR is doing very well for them. And the iPhone 11 is also doing very well for them. And for the other price points, they have the older model. So where does this fit in? I don’t really know. And it might actually work against them if they bring one more cheaper phone, because their entire premium play then sort of gets diluted. See, no people don’t look at it this way. Like let’s say if you look at the overall global numbers of phones then the Samsung and Apple maybe for last year has pretty much sold same number of Ford’s I think about 70,000,070 plus 70 million something but see Samsung also has a five 6000 rupee phone in that mix.

Shruti Dhapola:
Sounds like as a lot. Yes.

So the apples cheapest phone is not less than maybe $200 for $300. In fact, that is where Apple pushes value or missing value for the company not really for the consumer a lot of value in what they sell. That 70 million is much more pricier than the 70 million any other companies selling right now. You know even though who away or show me whoever is selling whatever numbers the value That Apple is pushing is it their phones are all premium and they’re still settings empty will lead. I don’t know whether they really want to go into 100 million kind of range by diluting that overall value because the number of units sold might go up substantially but the overall revenue might not go up that much. So I don’t know whether they want to replay that game.

Shruti Dhapola:
And let’s not forget that when the iPhone SE actually came to India, it was almost 40,000 which everyone said was oh my god, this is this price is completely wrong. So Apple has literally never introduced a phone at 30,000 in India, or at least a new for yes, you can buy a 30,000 rupee. iPhone will probably be two years old or three years old. But we know that Apple doesn’t go below a certain price point in various markets. We do know that.

Apple wouldn’t want a phone that competes with the shark me he I think it is okay competing with a one plus, because one plus is basically trying to undercut apple. So that is where the XR is no issue if you have a choice between the XR and the one plus 70. Maybe a lot of people might say still go for the the apple one despite it having less the cameras are because it’s happened. Right? I know it looks better in your hand and has more value, you know from eyeball perspective than having any other phone. So from that thing, you know, a lot of people have their aspirational value in the phone. But would you want to compete against a show me or I don’t think that’s what they will know. So I don’t really see sense in an SEC to know they might still go ahead and do it. And I was at the first St. Lawrence. So that happened, I think in March. Yeah, that’s coming. I do come in March. Yeah, I don’t think it will come into main September event. They are maybe winding up to a few events. tablets, also over the past couple of years started doing smaller events, which are much more focused on their target audience. So I think I wouldn’t be surprised if they do it but I really don’t see a lot of sense and then ultimately depends on what phone they come out with. Right and see an apple is a company that things through a lot of these things and if they’re launching something now, they would have thought through this two years ago,

about before the SEC Rumors for quite a while now. So

rumors last year also that’s my

Shruti Dhapola:
Yeah. People have been talking about that. It’s coming. It’s coming. It’s coming. But let’s see whether it actually launches in February unless coronavirus is going to place with Apple,

I’d wait for it to launch and then not take a call on that.

Shruti Dhapola:
We’ll have to wait and see if the iPhone SE two or iPhone nine as some are calling it does actually exist. And while it makes an appearance, so in the truly Apple way, I think we should have one more thing. And that is the fact that the home pod is now available in India. How much is it priced at 33 19,010 rupees

less than I think so it’s going to compete with the Amazon Echo.

Shruti Dhapola:
Have you tried the HomePod?

the import? Yeah, not at home. I tried it at Apple stores. Yeah, he’s very good. But I think he has one in our team yesterday one and cartilage.

One in India also as well. So I’m not I wouldn’t be surprised to happen. fanboy. ease. If I move a lot of things is covered needs to be rated. I think once it has a lot of

tickets a cupboard it’s I think a warehouse. But anyway, the home pod is coming. I think that’s interesting how this form factor in speakers is becoming quite popular.

Yeah. And what do you see for the homeport like to see you doing well, because it hasn’t

really sounds really good. Earlier it had great placing because the Amazon devices were not really there from an audio perspective. But Amazon Echo studio has really given Atmos 360 kind of audio quality in the room. homeport is pretty much the same thing. And I think it is no cheaper than the studio.

Yeah, Studios 21. But then it sells I think it comes to it is interesting. So I think the consumers winning here because you have great

audio,

and there’s at least a lot more options. You’re not just stuck with Amazon and Alexa products you can actually use there’s one more thing that has come to India. So that’s

it from us for this week regarding Apple Next week, what which brand I think we should go down the value chain and go to Samsung, I think that is maybe bigger than apple in numbers perspective. But still, I think the number two brand overall globally.

There are some some companies will say that the number one brand, but yeah,

everybody’s number one in one way or the other. That is fantastic. It’s depends on how we look at it.

Yeah. So that’s it from us for today. And see you guys next time. You’ve been listening to our own devices. This week’s episode was mixed and edited by Joshua Thomas, and produced by me, Neha Mathews. If you enjoyed that episode and want to hear more, please subscribe. You can find our own devices on all podcast apps, Spotify, and even more importantly, do rate us drop us review and tell a friend about it. You can follow us on Facebook and Twitter at the rate Express podcast for updates and send us your feedback there or send us an email at podcast this podcast with an S at Indian express.com Thank you for listening

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Unpacking Apple: What lies behind its success in IndiaWhat works towards Apple's success in India, a country where most can't afford its products? On this episode of the tech podcast, hosts Nandagopal Rajan and Shruti Dhapola dissect how the brand's value proposition, pricing structures, products like the Apple Watch, AirPods and Apple HomePods all work towards a brand that should not be underestimated. TRANSCRIPT Shruti Dhapola: So when it comes to Apple, in India there's always this hue and cry that the products are way too expensive. But if you look around these days, everyone seems to have them. I think the most popular Apple products right now that at least I see everywhere are the Air Pods but as Apple's own results show- the new iPhone strategy has really worked for them. It's the iPhone 11 that has helped them get to record numbers again, and the iPhone 11 is not what you'd call an affordable phone by any stretch of the imagination. Yes, it's certainly more affordable than say the Pro variants but it is certainly an aspirational phone. So we're going to be looking at Apple this week. We're going to start looking at each of the big smartphone brands on this podcast- what their strategies have been and how they've played out. And as always, it's me Shruti Dhapola and Nandagopal Rajan on Our Own Devices for Indian Express podcasts. So Nandu let's start with Apple's latest results. What stood out for them? We know of course, it's the iPhone 11. But how do you think this overall strategy has worked out? Because we're still waiting for the so called cheap or the affordable iPhone. Nandagopal Rajan: That's not coming, but you have a cheap iPhone or many cheap iPhones you can buy. Shruti Dhapola: Yes, the older ones. Nandagopal Rajan: The older ones. So that is a strategy. They're not going to come up with a cheaper iPhone. They did the SE, but I'm not sure they will do it again. There's a lot of buzz around the SE 2 or the iPhone 9 as they're calling it. iPhone 9 doesn't make sense to me. Why would they call it iPhone 9 when they have already done a 10? Shruti Dhapola: Yeah, they would be going back a number which again, doesn't make any sense. Nandagopal Rajan: But let's look at what's in worked for Apple this time. So the numbers say that Apple has done its best numbers in any quarter in India and Apple as a company. iPhone has been available in India from the first version, right? So these numbers are pretty significant. They are just under a million, which is not too big when you consider what a Xiaomi does, or Vivo, or Oppo. But it's quite big and almost, I think a lakh more than what Apple has ever done before in India. But the interesting thing is, Apple might actually be making more money than these other guys who are selling 18% or 20% of the market. So that is the interesting thing. Apple's value proposition or revenue per piece is so high compared to the budget players who will do volume but might not have value. Shruti Dhapola: Yeah, we know the iPhone 11 has done well. But I think one other thing that Apple did unique in the strategy was that the iPhone 11's 128GB version, when it launched, it was not immediately a 10,000 rupee markup. It was actually a 5000 rupee markup, which would have made sense to a lot of people, because they would have been like "Hey, why should I pay 64 for the 64GB version, when I can get the 128, under 70?" And then there's also the iPhone XR, which is actually continuing to sell well, because some people are now able to get it under Rs. 40K. Of course, this is with lots of exchange schemes and you know, cashback offers that have been clubbed together. So yes, the iPhone I will say is still a very premium product in India. But again, it's managing to at least get the customers that who don't want to maybe pay for an iPhone 11 Pro, and are okay settling for iPhone 11. And the iPhone 11 wasn't a bad phone either right? Nandagopal Rajan It is a good phone. Shruti Dhapola Yeah, but I'm talking simply in terms of filler specifications, because people tend to say that "Oh my God, why are the three cameras on the Pro?" Nandagopal Rajan So Apple has thought of this completely differently. And maybe that thinking starts with the last series of phones? They bought an iPhone XR, not as a cheaper phone, but as one version of their main offerings. So you XR, you had Xs and you had a XS Max right? So you have three phones. But the iPhone XR pretty much had the same innards as the other two phones. So if that is the base model, then you have phones that are improving on the base model. So it is like a lot of people don't want to pay for the cameras. A lot of people don't want to pay for the extra battery life. A lot of people maybe don't want a larger screen. So why do they have to pay for it? So it's like you buy this thing if you don't want two cameras, right? You get one good camera, but it's a very good iPhone camera. And the rest of the phone, the core things like the processing power is the same as the other two phones. And that strategy worked. The iPhone XR was cheaper than the other two, but it was not really cheap. That strategy worked really well, especially when the XR towards the end of the year started coming out cheaper in markets like India. And that's really helped them, you know, rake in a lot of numbers. Now, what Apple has done with the iPhone 11 is that the iPhone hone is 10,000 rupees cheaper than iPhone xR, which was cheaper than their other phones. Right? So they knew that strategy work, they went ahead and push that strategy even further. But look at it the other way. 64,000 is what you would pay for the premium Samsung phone. Right? And this is their cheaper version. And that is getting picked up. So that is where people are saying, hey, if I can buy an iPhone, why don't I buy the iPhone? Instead of thinking where can I save 5000 rupees? Shruti Dhapola: Yeah, and that's I think the value that Apple has also been able to create for itself in India because if you look at the exchange values for older phones and iPhone is any day going to fetch you a much higher price value. In terms of sheer numbers I'm saying, than say, a One Plus or even a premium Samsung device. Like six months down the line, everything's price is probably half of what you paid but the iPhone is still getting you a decent cashback or exchange. And that I think also matters to a lot of users who might want to upgrade say in the next two years or three years. Nandagopal Rajan: And this also helps with the refresh cycle or the loyal user, right? Like my wife just sold her iPhone 7, and bought a XR. And she got it for under 40K, as you said, because she was selling an iPhone 7. If she had an Android phone, she would have got 2000 rupees for it. So you know, it also makes value in the system where he you are thinking, I need to have an iPhone. So whenever I upgrade, I'll get the maximum I'd get for any smartphone at that given point of time. And that's something Apple has worked on really well. So the fact that Apple is not reducing the value or the price of its products means that there is value in the long run also. So even two-three years down the line, I would say there is no other phone that would get you a Rs. 6000-7000 buy-back in India. Shruti Dhapola: And there are very few phones which have been upgraded to say the latest version of the operating system which Apple is done consistently. Nandagopal Rajan: It's usually about 95% on the latest version. Shruti Dhapola: Yeah. And what we're hearing is that it will continue to support even the existing phones right now. Once the next version comes out or at least some variant of it is announced in June, Apple usually releases the next version of iOS in September. Nandagopal Rajan: The other interesting thing Apple is done is that, you know, while the phones are not something that everybody can afford, other products from the company are becoming more and more affordable. And you wouldn't look at it this way. But look at Apple Music. A lot of people who have never used an Apple product ended up buying Apple Music because at that point of time, it was among the cheapest and maybe the best music service you can buy for that price. And that opened up a lot of people to Apple services. And then you see there is a differentiator here when it comes to the services they provide. And that is also bait for people to maybe move to other products from the company. Shruti Dhapola: The Air Pods, I think, are one of the most popular devices from Apple. Even in India, the number of people I see using the Air Pods in a gym. And these are by the way, not Air Pods designed to be water resistant or sweat resistant and. There's so many people just using them because these are the most convenient devices. They work with every phone. And they work in every situation. And they work flawlessly most of the time. Nandagopal Rajan: So a lot of things you buy for the gym are not something you would want to use in the office while taking a call. But the Apple Air Pods sort of fits into all scenarios where it does not stick out as something that's awkward. Shruti Dhapola: Yeah, it doesn't look like oh my god this is has to be for the gym only. I can't wear them anywhere else. The Apple Watch itself. I think a lot of the high end iPhone users have converted themselves to the Apple Watch. They've gone ahead and chosen this accessory and it remains the best seller in the market because I don't think anything has come even close to it. It's just so convenient. And I've used quite a few smart watches and fitness bands for review. And I'm sure Nandu is also used quite a fair bit. Nandagopal Rajan: Did you say fair bit or Fitbit? Shruti Dhapola: I knew you were going to make that pun as soon as I said it. So yeah, that's the thing with the Apple Watch. And in fact, I used to think like, three years back that you didn't need an Apple Watch. Then I borrowed one review unit from you. I used it and I was like, okay, I need the Apple Watch. Nandagopal Rajan: So it's become a way of life for somebody like me. I'm diabetic, I need to look at a lot of indicators in my day to day. So I'm the real quantifiable self right? My diabetologist actually looks at the time I wake up and factors that into my sugar level at the time. And after looking at that sleep study, which I'm getting from the Apple Watch, and comparing it to my sugar levels, I have a lot more insight. My doctor, who is anyway very tech savvy, and, and he has a lot more insight on the kind of medication or what kind of insulin I should take. So often when you are testing your sugar levels, it does not correspond to where it should be. So (with the Apple Watch) a lot of people are getting these kind of insights because you have a very powerful computer on your wrist right? And even things like fall detection at all I think is very, especially for older people and how you can keep track of them. So those kind of things are very interesting. Shruti Dhapola: Yeah, the Apple Watch is truly become, you know, I know it was like a lot of people were very unhappy a lot of at least my friends who were hardcore Apple fans are like why is the watch not round? And we see so many coming up which looks suspiciously very much like the Apple Watch. Nandagopal Rajan: See people don't realize this is the most sold watch in the world right now. Not even smartwatch. Apple, I think overtook Rolex about a year ago and it is the most popular what's in the world right now? The Air Pods are the most popular earphones in the world right now, people always look at iPhone, but see all the other things that they do. Shruti Dhapola: We also talked about services in India, we've noticed their services are actually priced much lower. If you notice, it's the reason I think Apple Music is not 99 rupees a month, it used to be 120, which is again because of the competition from its beat. Yeah, it's made. But that's also one of the reasons I think a lot of iPhone users are not going to cancel the Apple Music subscription because it just especially if you're someone who is not only listening to say Hindi or regional music, I think Apple Music does have barely even iCloud is much cheaper here than rest of the world, right? I don't know about that. Nandagopal Rajan: You know, people, some are very hesitant to pay for cloud storage Shruti Dhapola: Cloud Storage is but there's someone in our team who keeps saying that he's run out of Gmail, but refuses to pay for Cloud Storage. Nandagopal Rajan: So I pay for Google I pay for Apple and I also pay for Dropbox. Shruti Dhapola: Oh, you still paying for Dropbox? Nandagopal Rajan: I don't know why, but I do. So the other interesting thing where the cheaper iPhones, right, he spoke about the iPhone SE, but a lot of people are actually experiencing the iPhone first from older devices. And again, it's a bit of a kind because even if you use an older device, you see the value and then you want to move up the value chain. So the next time know if this time or this year, you're buying a phone that's maybe four years old, because it's very affordable for you. Next time, you might buy a phone that is two years old or a year old, and you're paying slightly more than what you would have paid last time. And I'll give you the example of my wife, who bought the iPhone seven around the time the iPhone 10 was coming. And when iPhone 11 has come she's moved to the iPhone xR which is just a year old, you know. So this is the progression and you move closer to the current model. Right. And again, the arbitrage between the older phone and the new model. That's gum, the price differential also goes down as you go up the value chain, and you want to move to the the older phone. And Apple has had problems with this, it's not really been able to sell the newer devices in comparison to the older devices. And I think that is where iPhone Levin has really helped them sell the current device more than the older devices. Shruti Dhapola: But let's also talk about the you mentioned the cnse was kind of a hit in India because I know a lot of friends went out important especially when it was dealing say under 30,000 under 20 at times the iPhone SE two i mean do you think it should happen or it's like something that happens called escape because there's a lot of buzz and chatter around it because it apparently will have the design of the iPhone eight, slightly bigger screen, it will still have a high end processor which is the eighth it will have the a 13 processor so it won't compromise and an apple could be targeting you know the iPhone six your iPhone SE users who may have you know, an older device and they want to get the latest features. So Get them onto the SE to do what he what I So as you said it's not very clear who is going to target right? See for me an iPhone SE buyer will be a person not looking at the price that much because you have pretty much have an Apple device available at let's say every 510 thousand. Right now you can buy the iPhone seven you can buy the iPhone eight, you can buy the 10 s you can buy the 10 are the price points are pretty much covered now and I don't think if an iPhone SE two comes it will come for less than 30 k if it comes at that price point. So you already have options there. iPhone xR is a pretty good phone if iPhone SE two comes at under 40 it will not come with maybe the latest a 13 chipset right might not be possible. I don't know whether it's possible for Apple to do that. And then again, that puts pressure on the iPhone 11 if you do that, like so I don't see a possibility there from a price point. Now the other possibility is to offer the iPhone as he sighs which a lot of people really want I see a lot of people still holding on to the iPhone five form factor because they really like a phone that they can grip in the hands. And you actually don't have a lot of phones like that in the market, right? So the under five inch screen size still has a lot of value for a lot of users. That could be a good selling point for this phone. But again, if you're saying it's going to look like the iPhone six, then it's not going to know you're gonna look like the iPhone eight. So the SEC was actually four inches screen, which is which would Apple stuck to a long time when they didn't want to? And when they finally upgraded with the six to the 4.7 inch and the 5.5 inch displays, Shruti Dhapola: But I still have people ask me Hey, when's the iPhone SE two gonna come out because a lot of people are still waiting to upgrade. And you're right. A lot of people don't want phones which are like six inches screen and seven inches cream. And they want a spoon which is say under five inches and easy to use, you know, a phone that is smaller, but is not exactly cheaper. If it does come and I think that is now looking at Apple over the years. I think that's where they might see the value. I don't think they actually need a cheaper phone right now. Yeah, because the iPhone xR is doing very well for them. And the iPhone 11 is also doing very well for them. And for the other price points, they have the older model. So where does this fit in? I don't really know. And it might actually work against them if they bring one more cheaper phone, because their entire premium play then sort of gets diluted. See, no people don't look at it this way. Like let's say if you look at the overall global numbers of phones then the Samsung and Apple maybe for last year has pretty much sold same number of Ford's I think about 70,000,070 plus 70 million something but see Samsung also has a five 6000 rupee phone in that mix. Shruti Dhapola: Sounds like as a lot. Yes. So the apples cheapest phone is not less than maybe $200 for $300. In fact, that is where Apple pushes value or missing value for the company not really for the consumer a lot of value in what they sell. That 70 million is much more pricier than the 70 million any other companies selling right now. You know even though who away or show me whoever is selling whatever numbers the value That Apple is pushing is it their phones are all premium and they're still settings empty will lead. I don't know whether they really want to go into 100 million kind of range by diluting that overall value because the number of units sold might go up substantially but the overall revenue might not go up that much. So I don't know whether they want to replay that game. Shruti Dhapola: And let's not forget that when the iPhone SE actually came to India, it was almost 40,000 which everyone said was oh my god, this is this price is completely wrong. So Apple has literally never introduced a phone at 30,000 in India, or at least a new for yes, you can buy a 30,000 rupee. iPhone will probably be two years old or three years old. But we know that Apple doesn't go below a certain price point in various markets. We do know that. Apple wouldn't want a phone that competes with the shark me he I think it is okay competing with a one plus, because one plus is basically trying to undercut apple. So that is where the XR is no issue if you have a choice between the XR and the one plus 70. Maybe a lot of people might say still go for the the apple one despite it having less the cameras are because it's happened. Right? I know it looks better in your hand and has more value, you know from eyeball perspective than having any other phone. So from that thing, you know, a lot of people have their aspirational value in the phone. But would you want to compete against a show me or I don't think that's what they will know. So I don't really see sense in an SEC to know they might still go ahead and do it. And I was at the first St. Lawrence. So that happened, I think in March. Yeah, that's coming. I do come in March. Yeah, I don't think it will come into main September event. They are maybe winding up to a few events. tablets, also over the past couple of years started doing smaller events, which are much more focused on their target audience. So I think I wouldn't be surprised if they do it but I really don't see a lot of sense and then ultimately depends on what phone they come out with. Right and see an apple is a company that things through a lot of these things and if they're launching something now, they would have thought through this two years ago, about before the SEC Rumors for quite a while now. So rumors last year also that's my Shruti Dhapola: Yeah. People have been talking about that. It's coming. It's coming. It's coming. But let's see whether it actually launches in February unless coronavirus is going to place with Apple, I'd wait for it to launch and then not take a call on that. Shruti Dhapola: We'll have to wait and see if the iPhone SE two or iPhone nine as some are calling it does actually exist. And while it makes an appearance, so in the truly Apple way, I think we should have one more thing. And that is the fact that the home pod is now available in India. How much is it priced at 33 19,010 rupees less than I think so it's going to compete with the Amazon Echo. Shruti Dhapola: Have you tried the HomePod? the import? Yeah, not at home. I tried it at Apple stores. Yeah, he's very good. But I think he has one in our team yesterday one and cartilage. One in India also as well. So I'm not I wouldn't be surprised to happen. fanboy. ease. If I move a lot of things is covered needs to be rated. I think once it has a lot of tickets a cupboard it's I think a warehouse. But anyway, the home pod is coming. I think that's interesting how this form factor in speakers is becoming quite popular. Yeah. And what do you see for the homeport like to see you doing well, because it hasn't really sounds really good. Earlier it had great placing because the Amazon devices were not really there from an audio perspective. But Amazon Echo studio has really given Atmos 360 kind of audio quality in the room. homeport is pretty much the same thing. And I think it is no cheaper than the studio. Yeah, Studios 21. But then it sells I think it comes to it is interesting. So I think the consumers winning here because you have great audio, and there's at least a lot more options. You're not just stuck with Amazon and Alexa products you can actually use there's one more thing that has come to India. So that's it from us for this week regarding Apple Next week, what which brand I think we should go down the value chain and go to Samsung, I think that is maybe bigger than apple in numbers perspective. But still, I think the number two brand overall globally. There are some some companies will say that the number one brand, but yeah, everybody's number one in one way or the other. That is fantastic. It's depends on how we look at it. Yeah. So that's it from us for today. And see you guys next time. You've been listening to our own devices. This week's episode was mixed and edited by Joshua Thomas, and produced by me, Neha Mathews. If you enjoyed that episode and want to hear more, please subscribe. You can find our own devices on all podcast apps, Spotify, and even more importantly, do rate us drop us review and tell a friend about it. You can follow us on Facebook and Twitter at the rate Express podcast for updates and send us your feedback there or send us an email at podcast this podcast with an S at Indian express.com Thank you for listening
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