The iPhone, while highly subsidized here in the U.S., can still feel pricey. Most Apple products are. But in Russia, where there isn’t the same long-term commitment/subsidy pricing, the iPhone costs upwards of $ 1,000.
And the country’s largest mobile service provider, OAOMobile TeleSystems (MTS), isn’t happy about it.
“They’re more in a dictatorship mode where they say, ‘This is what you have to do or you don’t get the iPhone,’” said MTS’ VP of marketing Vasyl Latsanych. “Being arrogant with your partners in big markets doesn’t pay off.”
According to MTS’ VP for strategy and corporate development Michael Hecker, Russia’s smartphone penetration is expected to grow from 15.4 percent in Q1 2012 to 60 percent by the end of 2014. Hecker also mentioned that a price reduction would help Apple take advantage of the growing hunger for smartphones in the region, reports Bloomberg.
After a disappointing Q3 earnings report just last week, Apple CEO Tim Cook faced questions of whether or not the iPhone’s strict and high price was affecting the device’s success in emerging markets.
But in proper Apple fashion, Cook linked it back to the company’s utmost concern: quality of product.
I firmly believe that people in the emerging markets want great products like they do in developed markets. The goal is to make the very best product, and that’s more important and overshadows all other things.