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Apple to open its first R&D centre in India in Hyderabad

apple-maps-iphone-memeApple has stated that it plans to setup a Research & Development centre in Hyderabad, reports ET. The tech giant plans to invest $25million (Rs 170 crore) in the new R&D centre, which could employ about 4,500 people. An Apple spokesperson told ET that the new Hyderabad R&D centre “will be home to over 150 Apple employees supporting maps development.”

Apple is yet to sign a memorandum of understanding (MoU) with the IT ministry of Telengana, which will give it an area in the SEZ near Tishman Speyer’s WaveRock facility. 

Similarly, Google also plans to hire more engineers in India, opening a new campus in Hyderabad, and train 2 million Android developers and bring more people in India online through initiatives such as Project Loon.

Focus on India: For the quarter ended December 2015, CEO Tim Cook said that the India revenues were up 38%. In constant current terms, the revenue growth was 48%. Cook also said that the company is increasingly putting more effort in India operations. “It’s a very rapidly expanding country. And I think the government there is very interested economic reforms and so forth that I think all speak to a really good business environment for the future,” Cook said.

Pricing a hurdle in India
Apple’s move of opening an India office comes after it crossed the $1 billion sales mark in India during last year, and sold an estimated 800,000 iPhones in India during Q4 FY2015. However, even with these numbers, the premium segment of the Indian mobile handset market (> Rs 50,000) accounted for just 0.6% of the market, according to a Cybermedia Research report. That includes Apple’s high-end iPhone 6s models, as well as Samsung’s Edge series phones above Rs 50,000.

The only hurdle Apple faces is its pricing: according to Cybermedia research, the ASP (Average Selling Price) for a smartphone in India in 2013 was Rs 13,000 (~ $200) which stepped down to a substantial Rs 10,700 (~ $160), by the end of 2015.

Manufacture in India?
In June last year, we reported that Apple’s iPhone making company Foxconn could possibly set up base in India to manufacture iPhones, iPads and iPods for Indian and international sales. This would play a role in reducing the prices of the iPhone, lower production costs and help Apple keep up with orders and demands. Foxconn had previously stated that it was planning to develop 10-12 facilities in India, which would include factories and data centres by 2020.

(Picture Credits: Weknowmemes)

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