“Neither factor works as well in China. There, many of Apple’s services have not taken off,” The Economist reports. “The American giant missed the boat on music sales in the country, reckons Matthew Brennan of China Channel, a technology consultancy. Its sales of books are blocked by the government. In addition, few would disagree that its messaging service [in China] is a flop and that Apple Pay, its mobile-payment offering, is irrelevant—its market share on the mainland is only 1%. A ‘genius’ employee at an Apple store in Shanghai admits sheepishly that ‘iCloud doesn’t work very well in China.'”
“Nearly everyone uses WeChat, an app made by Tencent, one of China’s three big internet giants, for everything from social media to payments,” The Economist reports. “Through WeChat it is easy to transfer photos, messages, contacts and payments history maintained on that app from one device to another. No wonder that Apple’s retention rate among iPhone users, which tops 80% in America and Britain, is only 50% in China.”
“Hostilities have now broken out with Tencent,” The Economist reports. “The two had co-existed happily: since richer Chinese prefer iPhones to Android phones, these devices are where WeChat made much of its money. But earlier this year, WeChat launched ‘mini-programmes,’ a form of lightweight app that operates independently of Apple’s app store and robs it of revenues. Apple, meanwhile, had disliked but tolerated WeChat’s practice of allowing users to reward generators of content (for example, opinion columns) with small tips. These bypass Apple’s own payments mechanism. On April 19th Apple obliged WeChat to shut down tipping.”
Read more in the full article here.
MacDailyNews Take: iPhone is popular in China, but not as popular as WeChat.
Apple doesn’t have the strongest hand here. Maybe Cupertino can pull out a win in this somehow, but it doesn’t look too promising.