Apple ‘Dictates’ to Russian Phone Carriers

Apple ‘Dictates’ to Russian Phone Carriers

Americans who complain about the high price of the latest iPhone should be grateful they don’t live in Russia, as the popular Apple smartphone is not subsidized there at all, and can cost a pretty ruble.


Russia does not have the same subsidized iPhone pricing, so its 64 GB iPhone 4S costs roughly $1242 USD through the country’s largest carrier, OAOMobile TeleSystems, otherwise known as MTS. The 8 GB iPhone 4, which will soon be two generations outdated, boasts a hefty $800 USD price tag.

“They’re more in a dictatorship mode where they say, ‘This is what you have to do or you don’t get the iPhone,’” said MTS Vice President of Marketing Vasyl Latsanych to Bloomberg. “Being arrogant with your partners in big markets doesn’t pay off.”

Michael Hecker, VP for Strategy and Corporate Development for MTS, says Russia’s smartphone penetration is slated to go from 15.4% in Q1 2012, all the way to 60% at the end of 2014.

“If Apple showed more flexibility then they would have a higher penetration in our markets,” says Hecker.

During Apple’s Q3 2012 earnings call, the company’s CEO Tim Cook dodged questions about the high price of iPhones in emerging markets. The executive remarked that “great products” is the company’s goal when they are developing those markets.