iPhones are always considered premium device both in Indian the US., but you may have seen people getting iPhone for a quarter price in the US.
Even on the Apple’s official website, you can see iPhone 5 (16 Gb) selling for only 199$ in the states. But in India, a brand new iPhone starts from 50,000 INR i.e. roughly $750.
So why is that? Why is iPhone so expensive in India?
Some of you may think, well it’s because of taxes and import duties. But it’s not.
So What make iPhones cheaper in the US?
Because it’s subsidised by the network provider like AT&T and T-mobile. Which means if you are buying it from iPhone from Apple online store then you have to buy it with the 2-year contract.
In India, you can change carrier whenever you want, simply remove the sim card and insert a new one from a different provider. But that’s not how it happen when you are in a contract with a network provider.
This brings us to another Question,
Is it necessary to buy an iPhone with a contract?
No, If you want, you can buy it without a contract at regular price. There they called it — unlocked phone i.e. you can put any sim card in it.
However, it’s a common trend in the US, to buy iPhone with the service provider like AT&T and T-mobile and Verizon. Even on the Apple’s website, they sell it with the network provider only.
An unlock iPhone is sold at the same price as a regular iPhone in India, obviously after adding taxes and import duties.
What Network Providers get After Subsidizing iPhone
Unlike In India, where voice and data charges are low; in the US, these charges are pretty high. And iPhone users have a service contract with a network provider, who charge them little more than usual.
It’s like buying an iPhone in EMI. You pay extra every month, as an installment.
Can you use subsidized iPhone from the US in India?
Yes and No. Technically you can do it but not legally. iPhones are locked to a selective carrier and can be used only inside the country. But sometimes people also illegally unlock it and use it in other countries.
This brings us to the fact that although iPhones looks cheaper in the US, in reality, the price is almost same everywhere when we remove custom and taxes.