Two Indian telecom operators are in talks with Apple Inc. to launch an iPhone in India based on the code division multiple access technology in a bid to tap the growing smartphone market in one of the world’s fastest-growing mobile markets, people familiar with the matter said.
The talks with Reliance Communications Ltd. and Tata Teleservices Ltd. –which offer mobile phone services based on CDMA technology–come soon after news that Apple is making a version of its iPhone that Verizon Wireless will sell early next year in the U.S. Verizon Wireless offers mobile phone services based on CDMA technology.
“Tata has been in talks with them [Apple] for four to five months now,” said one person familiar with the negotiations.
“This [talks] has been going on as India is a big market for CDMA. It [any launch] should benefit both parties,” the second person said.
It is unclear though when any launch may take place, these people said.
Anand Baskaran, an Apple spokesman for India, declined to comment.
Apple’s iPhone is currently available in India through operators Bharti AirTel Ltd. and Vodafone Essar Ltd., a unit of Vodafone Group PLC, which offer services under the global system for mobile communications, or GSM, technology.
Launching a CDMA phone will give Apple access to more customers in the world’s fastest growing telecom market, which is adding around 18 million users a month. The country currently has about 670 million wireless users, of which roughly 20% use CDMA phones. For the two local operators, offering a CDMA iPhone would help them battle shrinking revenues and margins due to intense competition. Currently, the cheapest iPhone in India costs more than $670 and is considered very expensive for a country where 42% of the population earns less than $1.25 a day.
Moreover, Google Inc. is pushing to become a significant player in India through little-known Indian handset makers that are poised to launch low-cost devices that include the tech giant’s Android operating system in coming months.
“While the possibility of a CDMA iPhone through Reliance Communications or Tata would help Apple, it is unlikely to generate significant volumes in India,” said Daryl Chiam, a senior analyst at research firm Canalys.
Apple accounted for less than 1% of the India’s smartphone market share in the first half of 2010, said Mr. Chiam, adding that in contrast, Nokia shipped 1.8 million smartphones in India and accounted for 71% of the market in the same period.
However, India’s smartphone market is expected to grow to 38 million units in 2014, representing a compound annual growth rate of more than 78% from 2009.