MTS criticized Apple
According to Bloomberg, the Russian telecom operator Mobile TeleSystems OJSC (MTS) has officially accused Apple of arrogant attitude towards partners and strict pricing policy.
According to MTS, Apple’s share in the Russian market would be significantly higher if the company showed “greater flexibility”, whether it was lowering prices for its devices or helping operators subsidize sales.
Regarding Apple’s pricing policy, MTS Vice President for Marketing Vasil Latsanich believes that the high cost of a smartphone complicates its sale on the market: “This is a dictatorship. Such arrogance in relation to partners in a large market will not give a return.”
Apple creates additional difficulties for the Russian operator by strictly monitoring the compliance of MTS stores with a number of international standards, which is associated with significant costs.
As for subsidies, unlike the United States, Russian smartphone users do not practice long-term contracts with operators at a fixed rate, therefore, it is not profitable for the operators themselves to subsidize the purchase of an iPhone. For example, in the US, operators AT&T and Verizon Wireless offer the latest versions of the iPhone 4S for $199.99 with a two-year contract. In Russia, such a policy has not taken root, and users are forced to buy smartphones at full cost.
It is worth noting that in the “gray” market, you can buy an iPhone much cheaper than from official sellers. According to analyst Eldar Murtazin, it is much more profitable for an American corporation to sell the iPhone on the unofficial market: “First, the phone starts to be sold in the US and European markets, and then it enters the Russian market. As a rule, in this case, the service costs for the smartphone are removed. This is about $ 80 from the phone – a significant plus to Apple’s profit,” he says. “Therefore, the corporation needs a high cost of the phone in Russia to alienate consumers from official sales and motivate them to buy phones on the gray market.”
Earlier, some experts have already questioned the justification of Apple’s sales policy in emerging markets and unwillingness to lower prices for its devices in countries such as Russia.
When asked whether the company’s strict pricing policy will not harm sales growth in developing regions, Tim Cook, Apple’s executive director, noted that for Apple’s management, the main issues are the quality of their devices, not the price. “I firmly believe that people in emerging markets want great products just as much as consumers in developed countries. Our goal is to create the best products, this is the most important thing, and it overshadows everything else,” he said.
