Impact on the Indian smartphone market if Apple officially starts selling refurbished handsets.

India, the home of more than 1.2 Billion people recently surpassed USA and became second largest smartphone user country in the world and this happened when only 17% of India’s population owns it. It is estimated that by 2020, India’s average age will be around 29, which unlocks huge potential for smartphone and data penetration.

The rising competition and price war among smartphone manufacturers in order to win a share in Indian pie is providing users with affordable mobile devices and recent steps of Reliance Jio is expected to enhance the internet usage through smartphone. Since India is lacking wired broadband infrastructure, India is poised to leapfrog it with wireless data usage and the combination of rising young population and growing purchasing power will exponentially enhance this process.

Android is the clear leader in the Indian marketplace with around 97% share and Apple iOS is lagging far behind. Google’s operating system is heavily backed up by its huge portfolio and is supported by maximum of mobile devices in India. Popularity and trust on Google and the affordability of Android handsets are the main reason behind the exponentially rising sales of Android based phones whereas Apple iPhone is considered as a status symbol and is has an image of elite mobile phone which can be afforded by upper class who can pay good price for it. But majority of Indian population comes under lower income group and this must be the focus for the companies in order to sell its product in order to get a bigger pie.

Apple is the premium product company and is not ready to sell its iPhone on lower prices as it could downgrade its status and its brand value and due to this reason, Apple is still struggling to increase its penetration in Indian market which could become another China for it, if played strategically. Apple’s CEO Tim Cook visited India with an idea to grab an opportunity to sell low priced refurbished phones in Indian market so as to capture bigger piece of price conscious Indian market but Indian government rejected the proposal, driven by reason that this might defeat the purpose of Make in India campaign and it might trigger the flood of used electronics in Indian market.

If Apple receives ascent from Indian government to import and sell its refurbished iPhones then it might drastically affect the statistics of Indian smartphone market. The refurbished iPhone will be sold at relatively cheaper prices and this will give a chance and choice to non iPhone users to opt for better performing devices at the same price. This will definitely intensify the price and quality war in Indian smartphone market and this will be favoring consumers. This will also help in expansion of 4G market in India and will finally pressurize the competitors to further slash prices on 4G handsets. This will depend up on the quality of refurbished phones, if they could provide high quality which is USP of Apple, than this will become the ground breaking step and will unlock Indian market potential for it.

Talking about the logic of India to become dumping ground of used electronics, Apple is trying to efficiently recycle the old and previously used electronics which is actually tested on similar parameters through which new phones has to go through before hitting the market. So it seems that the refurbished iPhone will be having high quality standards as the Apple will do the process of refurbishment in its own setup and not via third party. This will attract more people towards it, who actually want to own an iPhone but are unable to due to its premium price. If Apple will get clearance from Indian government to sell its refurbished phones in Indian market at competitive prices, then the geography of Indian smartphone market will definitely get impacted by this step and it will create a dent in Android market. In the end, if refurbished marketplace in India starts riding the growth curve, then the ultimate winners will be the consumers and environment.