India has said no to Apple’s plans to sell refurbished iPhones within the emerging economic workhorse.
According to an official from the ministry of telecommunications, Apple will not be allowed to import or sell refurbished iPhones in India for the foreseeable future, due in the main, to fears that the used iphones would further exacerbate India’s growing e-waste problems.
The move has been seen as a major setback for the US tech giant as they see expansion into India as offering the potential for huge rewards. Apple’s aims to have a bigger impact on the Indian market were dealt a similar blow last year when a similar bid was also rejected for the same reasons.
Apple had hoped for a different outcome when it made this year’s offer to sell pre-owned iPhones, especially due to the fact that sales of its hardware seems to have reached a saturation point in other markets.
Apple currently accounts for around 2% of the Indian market and has been lobbying the Indian government hard for permission to open up an Apple retail network in the country. However, other smartphone makers have been lobbying hard in the other direction as well, citing the fact that second hand iPhones would have a negative effect on demand for locally made cellular devices, and would also directly contradict the governments ‘Made in India’ strategy which favourably promotes the manufacturing of products from within India itself.
While the government’s environmentally minded thinking in regard to selling near end of life hardware has been lauded by some groups, critics have speculated that it is the opposition from these other tech manufacturers that has the real weight behind the decision.
India presents a problem for Apple in terms of trying to penetrate the market. Apple is generally reluctant to lower its premium price point offerings for its hardware, especially as it is the mark-up on the hardware where the company makes most of its profits. Being allowed to sell refurbished phones would have allowed Apple to attract new loyal users but at a more affordable rate.
It is unknown whether Apple will follow through on its request to open up an Apple Store network without the option to sell its refurbished line of iPhones.