Apple's misery in the emerging markets !!

Apple, the world's most innovative company, is touted as one of the most respectable firm America has ever produced. Without a doubt, Apple's products are revolutionary and always take us into a new era marked by greater sophistication. They create ripples in the markets much before their launch and the tsunami arrives the day they are in the market. Be it iPod, iPhone or the recent iPad, people have tortured their legs standing in ever-lasting queues, to get their hands on the "iProducts". But as much as Apple has succeeded in American and European markets, it has failed miserably in the emerging markets. Apple has failed to sell iMac, iPad and more so iPhone in the emerging markets like India and China. Looking at the potential these two markets possess, any CEO in the world would dream to conquer them. China is numero uno with 634 million mobile users, India is second with 427.3 million. Now that combined is fcuking 1 billion "can-be" customers. Shouldn't Steve Jobs pay attention to these markets which they respectfully deserve? Isn't it a job of Jobs, to multiply the money of his company's investors in whatever way possible?

There are many reasons as to why Apple has failed to make it's mark in these tremendously growing market. The first and the obvious reason is the cost of its products. They are humongously expensive in these countries when compared to the US. iPhone 3G(8Gb) costs around 4 times the cost as available in the US markets. And as a matter of fact, people in India and China are still not rich (despite bragging about 10% growth rate) and understandably would not like to pay such an amount of money when they can buy a bike instead. Moreover, as a part of their cheaper habits, Chinese and Indians prefer to buy Apple's products from US, either when they visit the country themselves or ask their visiting friends to purchase for them leaving their own country's market dry and hapless.

Secondly, there is a lack of aggressive marketing strategy. For no obvious reasons, the company has not shown any inclination towards making its products people's first choice in the emerging countries though they are "competition killer" in nature as they have shown in the American markets. There are no ad campaigns, no massive publicity when their competitors Nokia and Samsung are flooding the markets with the news of their new products and innovations. Apple still remains a company for elite in these countries.

Thirdly, iPhone comes bundled in with a service provider. Recently, there has been a boom in the number of service providers particularly in India which has made mobile usage as cheap as a postcard. Further, these service providers have various cellular plans which are designed to suit various kinds of users. Thus, this binding of service provider with the iPhone restricts the users to avail the services of their choice and advantage.

Fourthly, India and China do not walk hand-in-hand with US when it comes to telecommunications technology. While 3G services were introduced in the American and European markets much before 2005, they are still to be launched comprehensively in India and China. This lag in technological advancement make new Apple products which are designed keeping the latest US technology in mind less attractive in the "still developing" economies.

And last but definitely not the least, tough competition from key players in the cellular markets like Nokia and Samsung, who really understand the needs of the customers in these areas and have built their products to suit them. These companies have also invested heavily in massive campaigning, covering all the segments of the society. The competition has just grown stronger with the entry of new players. And Apple will now find it all the more difficult to sell its brand in China and India unless the governments of these countries decide to cut the duties on imported electronics items sharply.

Apple is still not the "Apple" in the emerging world. Apple might be the "God" of the American and European people but it should not overlook the other half of the globe. Purely in business terms, these market could be heaven for any technology company. American and European economies are on the verge of stagnation or rather decline, thus to keep up with the pace of growth Apple has achieved in the last decade they need to focus more on the countries like India and China providing people in these countries with what they want at a fair price. Apple knows well the power of its killer products, they are better than any of their contemporaries and should use it to their advantage rather than being gratified by their tremendous American and European sales figures.

If not now, then when?

Yes, that's the question boggling the mind of many environmentalists and researchers who understand exactly what's up with mother nature. We never faced a threat more severe than what we are up against now, "Global Warming". It is not only some social or economical threat rather it threatens the very "existence" of human survival on Earth. Isn't that grave enough?? Looking at the actions taken by our administrators, to mitigate this threat, it doesn't seem so. They are busy playing blame games against each other. India, China and other developing countries say US and European countries are responsible for Climate Change, hence they must take the responsibility of cutting down the carbon emissions (root cause of Global Warming). US and European countries on the other hand, hold the recent high growth in demand of fossil fuels in the developing nations responsible for the surge in Global Warming and wants them to cut down their use of carbon emitting substances drastically.

The average temperature of the globe has augmented more than 1 degree Fahrenheit since 1900 and the speed of warming has been almost three folds the century long average since 1970. All studies suggest that human actions, mainly discharge of green house gases from manufacturing units, vehicles and burning forests, are perhaps the leading factors contributing to global warming. Without action to reduce these emissions, the global average temperature is likely to rise a further 1.8-4.0 degree Celsius this century and by up to 6.4 degree Celsius in the worst case scenario, the IPCC projects. Even the lower end of this range would take the temperature to a threshold beyond which many scientists believe irreversible and possibly catastrophic changes would become more likely.

So the big question is, What steps are being taken by our administrators to avoid this catastrophe? And if we make an effort to find an answer, we'll see many promises being made by the Obamas and the Jintaos and the Sarkozys but nothing concrete has been achieved yet. Kyoto protocol, which is considered to be the first most comprehensive step towards arresting the quantity of green house gases emitted in the atmosphere, is a miserable failure. First of all, having an emission reduction treaty without USA cannot succeed. It is not only bias for developing nation who have just learnt the meaning of growth but also envious for developed European nation. They can't compromise their growth to control global warming when the biggest polluter in the world, cares least about it. Secondly, there are differences in the treaty regarding the levels of emission cut by individual nations. Some developing countries are allowed to pollute more. Moreover, on the technical front, scientists and researchers argue that the protocol was misconceived from the start because it was based on previous international treaties to protect the ozone layer, to stop acid rain and to control the proliferation of nuclear weapons. This borrowing simply failed to accommodate the complexity of the "climate-change" issue.

Then the whole world watched what happened at the Copenhagen Summit in December, 2009. The Copenhagen accord was drafted by the US, India, China, Brazil and South Africa. It was sought as a successful agreement by the Obama administration, but all the nations didn't take it likewise. It wasn't adopted in the debate of all participating countries. The document does not force nations to make any legally binding commitments for reducing carbon dioxide emissions, it leaves the decision on the social welfare will of the nations.

Is this our approach towards fighting this issue? Is this what we expect from our administrators? Aren't they aware of the rising number of instances of floods, storms and other natural calamities? I am a big Obama fan, but disappointingly, he has failed to deliver on this front, though this was one of his most promised agenda. The world, specifically our leaders need to wake up and address this issue with utmost priority and diligence before it's too late. Environmentalists should have a greater say and authority in policy making, because they know exactly what needs to be done. Agreements and deadline on Climate Change should be strictly met, in fact a severe penalty should be levied on the countries not meeting the proposed carbon cuts. A sense of "peer pressure" be built among economically similar nations to impose the reduction in emissions. And most importantly, people need to be taught and made aware of the ill-effects of carbon dioxide emission in to our atmosphere. A concerted effort is needed to arrest and control global warming. Be it the underdeveloped Africa or the developing Asia or the developed America and Europe, all need to come forward to fight for "human existence".

Read the previous article here Microfinance .

Deflation: A serious concern for Europe !!

You must have come across the news of countries going bankrupt as a result of hyperinflation, for example Zimbabwe which suffered from a 24000% inflation and it's currency became almost valueless, even less than the value of paper. Deflation can be equally killing. Deflation has a unique spiral effect. It occurs when there is a shortage of money supply in the market. Thus people have less disposable income to spend and there is a decline in the demand for products which in turn results in unemployment and further reduction in incomes and so on. It has the potential of bringing an economy to a halt. Japan is a good example of a country under deflation since many years which has resulted in a fall in the GDP of Japan and we see many countries surpassing Japan in terms of output growth.
European Central bank has a primary responsibility of keeping inflation under control. But it has become so obsessed with this task that it is ignoring a greater threat at it's disposal: DEFLATION. Economists regard deflation to be more serious than inflation. It is also bad for countries like Greece and Portugal which are under debt pressure to repay as deflation makes the currency more valuable. Most countries argue that they need to cut the money supply in order to reduce their deficits but what is the need of the hour?.The real challenge for policy makers will occur in the coming months and years as Spain, Greece and Portugal struggle to regain their competitiveness on international markets. Without their own currencies to devalue, they have little choice but to cut wages and keep them well below those in countries like Germany and France. Pay cuts and lower government spending will put downward pressure on prices. Spanish core inflation already turned negative in April. A mild decline in prices in a few euro zone countries can be managed, economists say, but it will add to the risks of deflation.And the central bank will face more difficulty than usual in devising a monetary policy that fits both the ailing countries and the faster-growing economies like Germany and France.