Apple CEO Tim Cook made an uncharacteristic admission today in an interview with Indian news channel NDTV — that iPhones are too expensive. He immediately qualified it, and the context really is important, but it’s just one of those things you don’t hear very often.
A report from Deutsche Bank found recently that India is among the most expensive places in the world to buy an iPhone, with prices averaging 31 percent higher than the U.S. — only Sweden, Indonesia and Brazil have it worse.
After some opening softballs (or rather, cricket balls), Cook faced some serious grilling on this topic from NDTV’s Vikram Chandra.
“You’ve got an iPhone here which is more expensive than it is in the U.S., with less functionality than it would have in the U.S., and in a country where purchasing power is a fraction of what it is in the U.S.,” Chandra said.
Cook acknowledged the truth of the statements, but caught himself before going too far.
“The duties and the taxes and the compounding of those takes the price and it makes it very high. our profitability is less in India, it’s materially less — but still I recognize that prices are high.”
“We want to do things that lower that over time, to the degree that we can,” he said. “I want the consumer in India to be able to buy at a price that looks like the U.S. price.”
He didn’t detail much in the way of concrete steps to this end, however, saying the company was “looking at India holistically” before getting into retail or fiddling with carrier relationships. And it’s worth noting that he did not say the iPhone was overpriced, merely too expensive. They’re different things, not that it matters to someone who has to pay $850 for a base-level iPhone 6.
“What we see here is talent,” he said, in response to questions on how Apple would be investing in its Indian presence. “That means getting the development community moving on iOS. We’re also using a lot of skills in India for maps… the maps facility will be several hundred million dollars worth of work.”
But the iPhone wouldn’t be getting a special, localized version at lower cost or with highly customized services.
“We want to bring Apple Pay to India. We want to bring every service that we do to India — every one,” he said. “And if there’s something unique that’s needed, we also want to do that.”
But not more than that: “I don’t believe personally in trying to be something you’re not. We are what we are. We’re a California company.”