Apple Inc. (AAPL) Needs Emerging Markets

Apple needs to dig deeper into Emerging Markets, Android’s Edge

Google Inc (NASDAQ:GOOG) disclosed that it is activating 1.5 million new Android devices every day, which goes to show the widespread consumer adoption of Android-based devices. And Android’s open source nature, coupled with relatively lower prices gives it a big edge in gaining market share among more price-conscious consumers in developing regions.

The company did slash prices for many of its older generation phones, but the price point for iPhones is still above the $600 mark, which is pretty high for many prospective consumers, especially those who earn less than $600 a month. As a result, Apple Inc. (NASDAQ:AAPL) needs to unveil a lower priced iPhone or cut prices of its older phones substantially to gain market share in these countries. The highly fragmented nature of Android makes it difficult for many app developers to roll out great apps, which is a positive for the iPhone maker. Apple has a thriving and vibrant ecosystem and can earn incremental revenues from its App store, as well, by adding more users from current levels of 575 million.

Apple disclosed that iOS now generates roughly 75% of all revenues from app downloads, whereas Android makes up only 20%. Google’s Play store has been growing rapidly in terms of app count, downloads and revenues, but still lags the monetization capabilities of Apple’s App Store.

Apple Inc. (NASDAQ:AAPL) can unveil lower priced iPhones in big markets like Brazil, India and China to gain ground on Android. According to Strategy Analytics, India is now the third largest smartphone market in the world, only behind the U.S. and China. And Apple’s ability to drive higher volumes in these BRIC countries will be crucial for the company’s fortunes down the road, as developed markets dry up.

The article Apple Needs Emerging Markets originally appeared on Fool.com and is written by Ishfaque Faruk.

Ishfaque Faruk has no position in any stocks mentioned. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google. Ishfaque is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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