“Apple Inc has a new China growth driver: animated dragons and warring royals,” Cate Cadell reports for Reuters. “As sales of its iPhones slip in a fiercely competitive market, the U.S. company is seeing stronger growth in its services business – from lucrative app sales to iTunes and digital payments. Driving this growth are online games available through its China App Store, such as current hits ‘King of Glory,’ ‘Fantasy Westward Journey’ and ‘Nest of Dragons.’ These apps are taking on increasing significance as Apple looks to revive growth ahead of the 10-year anniversary of its first iPhone later this year.”

“China drove around half the revenue growth for Apple’s App Store last year,” Cadell reports. “‘We had extremely strong services growth during the quarter in China,’ CEO Tim Cook told analysts after the results were announced on Tuesday, adding the segment posted ‘double digit’ growth. Revenue from Apple’s China App Store was more last year than that of China’s other app stores combined, according to app analytics firm App Annie.”

“But, as services sales rise, Apple faces new risks,” Cadell reports. “China is tightening regulation of cyberspace, including online media, live streaming and gaming. On Tuesday, tighter rules were put in place for online news portals and network providers, the latest step in President Xi Jinping’s push to secure the Internet and maintain strict Communist Party control over content.”

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MacDailyNews Take: China is like a box of chocolates…

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