During Apple's Q2 2016 earnings call, Tim Cook offered details on the vendor's performance in the Indian market, stating that iPhone sales were up by 56% from a year ago. Apple sold over 800,000 iPhones in the country in Q4 2015, which was largely driven by the introduction of the iPhone 6s and 6s Plus in the market and aggressive discounts on the part of retailers.
Tim Cook talked about the emergence of 4G networks in the country, which he said will "unleash the power and capability of the iPhone:"
And then on emerging markets, if you look at India we grew by 56 percent, and we're placing increasing emphasis in such areas where it's clear there will be disproportionate growth versus the more developed areas.
And from an India point of view, if you look at India—and each country has a different story, a bit—the things that have held not only us back, perhaps, but some others as well, is that the LTE roll-out with India just really begins this year. And so we'll begin to see some really good networks coming on in India. That will unleash the power and capability of the iPhone in a way that an older network, 2.5G or even some 3G networks, would not do.
The executive also talked about challenges faced by Apple in India, which center around the fact that it cannot sell phones directly to consumers:
Unlike the U.S. as an example, where the carriers in the U.S. sell the vast majority of phones that are sold in the United States, in India the carriers in general sell virtually no phones. And so it's out in retail, and retail is many, many different small shops, and so we've been in the process—we've got something we've just started in the last few weeks—we've been working in India for a couple of years, or more, but we've been working with great energy over the last 18 months or so, and I'm encouraged by the results that we're beginning to see there, and we believe there's a lot, lot more there.
Apple relies on the franchisee model, tying up with retail stores and partners all over the country. The company has sought permission from the Indian government for a single-brand license, which will allow the vendor to set up retail stores as well as sell products directly.
As for the maturity of the Indian market, Cook said that the country is where China was "7-10 years ago" when it comes to the market potential and economics:
It is already the third-largest smartphone market in the world, but because the smartphones that are working there are low-end primarily because of the network and the economics, the market potential has not been as great there, but I sort of view India is where China was maybe 7-10 years ago, from that point of view. And I think there's a really great opportunity there.