“China Mobile Ltd. (941) won state approval to start commercial service on the world’s largest fourth-generation wireless network, clearing a key hurdle to offering Apple Inc. (AAPL)’s iPhone to its 759 million subscribers,” Bloomberg News reports. “The world’s biggest phone company and two smaller domestic carriers received 4G licenses yesterday from China’s Ministry of Industry and Information Technology. China Mobile will deploy TD-LTE technology to promote faster downloads as it tries to push customers toward higher-priced voice and data plans.”
“Apple is close to agreeing to a distribution deal with China Mobile, a person with knowledge of the matter said in September,” Bloomberg News reports. “The carrier said in 2011 that Apple agreed to make an iPhone for its customers once it shifted to 4G.”
“As of Aug. 30, China’s Telecommunications Equipment and Certification Center had approved for service an Apple handset that could run on a 4G TD-LTE network in addition to China Mobile’s 3G network, according to a statement on the regulator’s website,” Bloomberg News reports. “‘In the long term, it is important for China Mobile to improve its cost structure by migrating users to 4G,’ Huang Leping, an analyst at Nomura Holdings Inc., said in an e-mail. ‘The Apple deal should help China Mobile to retain its high average revenue users.'”
“The absence of popular handsets like the iPhone limited China Mobile’s ability to compete with smaller China Unicom (Hong Kong) Ltd. and China Telecom Corp. (728) in winning users seeking high-speed connectivity. China Mobile has 759 million wireless users, more than the population of any other country except India, yet it had only 45 percent of the nation’s 3G users as of Oct. 31,” Bloomberg News reports. “China Unicom and China Telecom both carry the iPhone. The two carriers also received 4G licenses, China’s MIIT said in a statement on its website yesterday.”
Read more in the full article here.
MacDailyNews Take: There are two types of smartphone users: Apple iPhone users and all the rest. Carriers that are iPhone have-nots suffer greatly from lack of customer quality. China Mobile needs Apple more than Apple needs China Mobile.
Related article:
China issues 4G network licences to China Mobile, Unicom and Telecom – December 4, 2013
Wow, Apple on the largest 4G network of the world’s biggest phone company. Whore Street is going to have to work extra hard to keep the stock down now, and they haven’t been doing a very good job of it recently.
Way to go Apple.
Naw, I think Wall Street got what it wanted: shaken confidence in Apple, a prolonged drop in share price, erratic and large rises and falls, all to force Apple to do things like share buybacks and increased dividends. Not only that, but they proved that Apple isn’t immune to their manipulation. They got all they wanted from it, bought up all the shares they need to get even richer as AAPL goes up, and now they’re letting the stock rise back up so we can repeat the process again sometime down the line.
Yup, dang it you are more than likely right, just letting it grow back so that they can kick it down. Still the fundamentals are good, so it can take a kicking, not like many companies of the dot com bubble burst.
I wonder if and when that will happen to say Amazon or Google.
Thanks for your post, it makes a lot of sense.
Amazon is a house of cards–they’re rather ride it all the way up until it genuinely can no longer sustain itself and ditch it before it crashes and burns. Google will probably receive the Apple treatment eventually, though.
So you are predicting that Amazon will ditch before it crashes and burns. I have to say either course sounds exciting so I’ll make sure to have the popcorn ready when it goes.
Thanks for your feedback, it’s added to a great day.
China Mobile had to apply for a 4G licence to keep up with technological developments in the cellular communications industry. That is a given. If they hadn’t migrated to LTE, they wouldn’t have been able to hold on to their subscriber base or charge them data access fees which over time are becoming more important than voice levies.
However, it is by no means a given that China Mobile will sign with Apple because it has been granted a 4G licence. On the contrary, China Mobile could apply even more pressure on Apple to cave into its demands, probably a more preferential deal than currently prevailing with the other two China carriers, since the iPhone is already in a ready state to take advantage of LTE and the marginal cost to Apple of not joining (revenue foregone) is greater than that of joining due to the sunk cost of development.
You may be right in that China Mobile may still think they are in the driver’s seat in which case Apple will continue with the smaller telco’s. Eventually China Mobile will feel the hurt just like Verizon and DoComo.
IOW, Apple may need to teach yet another carrier they are nothing but a dumb pipe!
If no deal is made , how many can aapl drop ?
42?
Enough ?
Only have to look at NTT DoCoMo, which wouldn’t carry it for years and than had to due to losing out (http://appleinsider.com/articles/13/11/30/apples-iphone-5s-5c-take-9-of-japans-top-10-smartphone-sales-spots) to see the difference having an iPhone on offer to see what will happen with China Mobile.