An Apple – China Mobile deal may be imminent, but it isn’t driven by 4G

Reuters is carrying a story today suggesting that an imminent deal between Apple and China Mobile will be announced, perhaps as soon as next week,” Tim Worstall reports for Forbes.

“However, there’s one little detail that should be pointed to, the detail that shows that any such deal just isn’t being driven by the 4G network,” Worstall reports. “My sources tell me that China Mobile’s 4G network isn’t going to be operative until April, at least that’s the most recent date that they had heard. Even then it’s only going to be in Beijing and Shanghai at that date. This could be speeded up: the limitation is really how much money China Mobile is willing to firehose at rolling it out.”

Worstall reports, “So the real deal desired is to gain access to those covered by the TD-SCDMA network, the 3G one.”

Read more in the full article here.

16 Comments

  1. I’m sorry but iPhones aren’t seen as au courant any more in China. Apple owns less than 5% share of the Chinese smartphone market. Joining China Mobile won’t stem the bleeding. Tim Cook is clueless as to what Chinese consumers want. He’ll continue to sell expensively marginalised iPhones into China while the rest of Chinese manufactured Android smartphones eat the iPhone for lunch, and dinner too, come to that.

    It doesn’t help that the iPhone has the smallest screen out of all the major players which is a major turnoff for Chinese consumers. Samsung has quadruple the market share of Apple in China from a zero standing start. Apple will slip away into irrelevance if they don’t improve on the atrocious iOS 7 which makes the iPhone look like a child’s toy, not something desired by Chinese consumers.

    1. Funny, but a Chinese tech site I read specifically said that if Apple went down-market to sell in China, it would lose appeal to Chinese consumers. They had quotes from average people stating the same thing. Tim Cook has it exactly right.

    2. “Chinese manufactured Android smartphones eat the iPhone for lunch,”

      really?

      Lenovo giant Chinese PC and cell phone maker:
      quarterly profit 173 million.

      HTC (Taiwanese cell phone maker which sells a lot in china): net LOSS of 102 million. (get that? HTC LOST money!)

      Apple profit: 7500 million.
      (and one in six apple dollars come from China)

      does apple look as if it’s hurting?
      People who buy cheapo phones also don’t buy apps as is clearly shown by multiple studies (so the best developers stick with iOS). So why build no profit phones? Can you give me a good reason?

      with no profit you can’t also develop cutting edge tech: that’s why the 5s has twice the processor speed, 3 times the graphics speed and twice the screen sensitivity of the TOP Android phones like the S4 (the cheapo ones sold in china aren’t even in the same chart… )

      1. Chinese phone manufacturers, some of which you have never heard of, are willing to sacrifice profit today for market share. Once you entrench yourself by way of market share, the ecosystem will follow, and will spread by word of mouth and peer pressure. You would not want to be the only one in China using the iPhone. Once market share falls below 2.5%, a death spiral will set in because people will realise that buying an iPhone is throwing away money because it gains them nothing.

        If you think the Chinese manufacturers are stupid, you don’t understand the long game. Not by a long shot. Even the head of Android, Hugo Barra, jumped ship to join a Chinese phone manufacturer, so you’re looking at the future, whereas Apple lives in the past. resting on its laurels while the rest of the smartphone world powers past it. The long game is where it’s at.

        1. Have you talked with Apple about this? You seem to know a lot more than they do. It’s such a shame that you seem to possess such a vast knowledge of the way things work and the way people think, and yet would rather post anonymously on the Internet rather than make millions of dollars counseling these companies.

          Because if there was one company in the world that needs help it would be one of the most profitable companies that’s ever existed on this planet, the same one with the largest stockpile of cash to lose, and not to mention the hordes of happy customers to drive towards competitors.

          Thank god, you’ve shown up. I don’t know what I’d do tomorrow if Apple were to go under.

        2. Apple has won every serious fight it’s got into.

          IPod went against music players Saehan, Phillips, toshiba, Sony, Zune, Sandisk, LG, Samsung, Rio Diamond etc and dozens of no name Asian MP3 makers and WON. IPod still takes the bulk of the music player profits today.

          As for Mac… the conventional wisdom is that Apple lost the Mac PC wars… which is WRONG.
          Mac takes 40% of the PC industry profits today. Dell, HP, Acer , Asus, Lenovo, Samsung, Sony etc etc and DOZENS of smaller PC makers make up the other 60%! No PC maker in the world makes as much money as Apple with its Macs.
          (and I’m just counting Macs, if you count computers like iPads like they count Windows tablets as PCs, Apple’s profits will be off the charts).

          IBM stopped making money losing PCs years ago, Compaq gone, Gateway gone, HP debating whether to stop PC sales, Dell SOLD…. etc. Meanwhile Apple makes billions of Macs. Lenovo the biggest PC maker in the world like I said declared 173 m profit vs Apple’s 7500 m. Apple makes so much off Macs they can give OSX away for FREE while Msft has to charge $100 for crippled Windows HOME edition (hundreds for Pro versions).

          (in a game where you walk away with all the chips and your rivals go broke did you win or lose? LOL )

          Apple won the iPod wars, the PC wars and is all set to win the mobile wars. Android is dying (google has slowed interest in it as shown by the slow pace of updates and new stuff — head of Android Rubin pushed off to another department — as Google according to their own filings MAKES MORE MONEY OFF SEARCH ON IOS than Android search and services. google more interested in developing it s own Chrome related products . Samsung is worried enough to start working on Tizen ).

        3. Your analysis seem to be based on PC marketshare. In the PC market, 90% marketshare means that much profit for MS. What is the point in sacrificing profit for market share. Profit is what keep your company alive. The 80% of Android market share is distributed among a large number of OEMs and most of them small are not that profitable at all. Samsung is said to be gradually moving to Tizen. So why do devs prefer ios ahead of Android which has 80% marketshare ? In other words, why does ios with its lower marketshare have a healthier ecosystem than Android ? The reason is addressable market share for app developers or how many people are willing to buy you app ? The Android market share consists of large number of low end phones whose owners don’t buy apps. So the addressable market share for Android is actually less than that for ios. So even if Android market share gets to 98%, the ecosystem will be weak. The real threat to iPhone is only when something else takes its premium smartphone position.

    3. It is still a growing market for Apple…

      Sure Androids from Huawei win…. this in the one market where i dont think Samsung will in time be able to win vs Huawei.

      Regarding Apple, they wil be behind on market share… which is okay. they need to build enough gold phones to satisfy this Asian market.

      In any case. They have a market to grow into versus North America… If they keep selling more phones and keep their revenues growing versus the previous quarter… that is all that matters… They will never be able to mass produce enough phones… (aluminum/metal based, that is).

  2. I read somewhere earlier this month that 2% of China’s population buy 30% of the world’s luxury goods. Assuming there is even marginal validity to that claim, I’d say Tim Cook has it exactly right.

  3. Gee, just two days ago news hit that China Unicom and China Telecom both posted huge sales increases due to the iphone. So tell me aucourant, how much does Samsung pay you anyway?

    China Telecom Corp., the country’s third-biggest mobile phone company by users, posted a greater-than-expected gain in quarterly profit as users of Apple Inc. (AAPL)’s iPhone helped boost data sales. (728)

    Net income rose 20 percent to 4.5 billion yuan ($740 million) in the three months ended Sept. 30 from 3.75 billion yuan a year earlier, the Beijing-based company said in a statement on its Website today. That beat the 4.41 billion-yuan average of three analyst estimates compiled by Bloomberg.

    Chairman Wang Xiaochu is seeing the benefit from being one of two carriers to offer the iPhone, along with China Unicom (Hong Kong) Ltd., in the world’s largest smartphone market. Both companies beat earnings estimates for the period thanks to heavy data usage, while China Mobile Ltd. (941), which has yet to reach an agreement with Apple about offering the device, missed estimates.

Add Your Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.