Apple’s decision to halt sales in Russia puts pressure on Samsung


Apple CEO Tim Cook delivers the keynote address during the 2020 Apple Worldwide Developers Conference (WWDC) at the Steve Jobs Theater in Cupertino, California.

Brooks Kraft/Apple Inc/Handout via Reuters

BARCELONA — Apple’s decision to stop selling products in Russia puts pressure on other smartphone makers to do the same, analysts say.

Apple announced the decision on Tuesday along with a number of other actions in response to Russia’s invasion of Ukraine. All Apple products on the company’s Russian online storefront are listed as “unavailable” for purchase or delivery in the country. Apple does not operate any physical Apple stores in Russia.

The move “absolutely” puts pressure on rival companies like Samsung, CCS Insight chief analyst Ben Wood told CNBC on Wednesday. Samsung did not immediately respond to a CNBC request for comment.

“It’s important that they made a statement,” Wood said in reference to Apple. “They’re in the lead,” he said, adding that some of Apple’s rivals were selling significant volumes in Russia.

Apple also said it removed Russian state-controlled outlets RT News and Sputnik News from its App Store in countries around the world except Russia.

The Cupertino-headquartered tech giant is in a “strong position” to be able to take the steps it has taken, Wood said. “It’s a major player in technology and one of the most valuable companies in the world.”

The iPhone accounts for about 15% of the Russian smartphone market, according to Counterpoint Research, which estimates Apple sold about 32 million iPhones in the country last year.

Anshel Sag, principal analyst at Moor Insights and Strategy, told CNBC that Apple’s decision “could force others to follow suit.”

Since Russia is not a major market for Apple, the company’s actions are unlikely to have a significant impact on the company, according to Wood. “Their business is so big it’s very resilient,” he said. “For them, losing that revenue won’t have a catastrophic impact on the business.”

Technology analyst and investor Benedict Evans said financial sanctions and currency volatility may also have made it difficult for Apple to sell its products in Russia. Indeed, Apple suspended sales in Turkey in November when the lira crashed.

“The ruble fell by 30% yesterday [on Tuesday]so it’s unclear what price they should charge for an iPhone, and bank sanctions make it difficult, if not impossible, to transfer money from sales out of the country,” Evans told CNBC. “So whatever either politics, there are great practical difficulties for anyone importing goods into Russia at this time.”

Evans also noted on Twitter that Apple has no problem doing business in China, adding that “it’s always easier to live up to your principles when it’s not 20% of your income and most of your your production”.

On Tuesday, Ukrainian Deputy Prime Minister Mykhailo Fedorov called on Apple CEO Tim Cook to finish the job and block access to the App Store in Russia. On Wednesday, he urged Microsoft’s Xbox and Sony’s PlayStation to stop supporting Russian markets and “temporarily block all Russian and Belarusian accounts”.

Companies around the world are rapidly withdrawing from Russia as governments impose sanctions on the country. As Western countries withdraw support, Chinese companies like Huawei and Xiaomi may have an opportunity to push deeper into the country.

“The Chinese are well established [in Russia] and business ties appear to remain open,” Wood said. “It could be an opportunity.




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