iPhone 3GS Sales Will Probably Fail in Russia as Well

Only last week I reported here on the situation with terrible iPhone sales in Russia: all the three Russian mobile carriers are obliged to sell a total of 3.5 million units over two years but have only managed to sell 250 thousand phones by now - and the sales will hardly accelerate.

The main reason for such poor sales is price: since iPhones are not sold here on service contract (which is not a common practice in the country at all), the device is more than expensive: the sales started at the point of over $1,000 and currently the price varies in the range from $700 to $800.

Given the negative situation with sales, the Russian carriers stopped buying iPhones from Apple as they have plenty of units that they can’t move anyway and have begun negotiations with the manufacturer trying to agree on a lower price to improve sales in Russia.

But it now looks like sales of iPhone 3GS will be a similar disaster in the country as well because the negotiations do not seem to prove a success. The main goal of such negotiations for the carriers selling iPhone in Russia is to lower the purchase price that they pay for the phones. And this is exactly where Apple is unwilling to give in.

Today one of the leading Russian business publications reports on the progress (or lack of it) in the negotiations. Their sources claim that Apple set the purchase price of 550 euro per device. The taxes and customs fees will increase the price by 120-130 euro additionally. So the end user price will be about $1,000 in rubles again - which makes me question the prospects of sales again as Russia is not really a country full of millionaires.

Since Apple is not willing to lower the purchase price for the Russian carriers, they are in turn unwilling to begin sales of the new model - iPhone 3GS - which was scheduled to debut in Russia in August. But as of now, the carriers have not purchased and imported the gadgets here and are desperately trying to sell the existing unsold items, one of them arranging for a big sale where iPhone can be bought for approximately $500.

So as of now, there are no definitive agreements between Apple and Russian carriers on actual purchase of iPhone 3GS and the debut of the new model here will definitely be postponed. What’s more, if Apple does not improve pricing conditions for the Russian market, chances are that iPhone 3GS will face the same disaster here as iPhone 3G and some analysts even predict that the new model will not be sold here at all.

Via (in Russian)