“Certain people seem not to have quite grasped Apple’s basic business strategy,” Tim Worstall writes for Forbes. “As a result they’re insisting that without a cheap iPhone then Apple won’t be able to make the most of its recent deal with China Mobile and the access that gives to their 760 million subscribers.”
“What’s being missed is that Apple simply doesn’t care about market share. As a properly capitalist company it cares about the profits it can make for its shareholders only,” Worstall writes. “An example of this is [CNNMoney‘s David Goldman]: ‘Apple CEO Tim Cook has discussed gaining a stronger foothold in China as a major priority for the company. The China Mobile deal will help Apple accomplish that. But unless Apple changes its strategy and offers a low-cost iPhone for the Chinese market — something the company has proven unwilling to do — it’s unlikely that Apple would become a top Chinese smartphone player.'”
“Apple has repeatedly said that it’s not interested in being a top Chinese or anywhere else smartphone player. It’s interested in being a top player at the top end of the smartphone market which is an entirely different thing,” Worstall writes. “They don’t go into low margin products in the chase for market share, they’re quite happy staying where they can make 35 and 40% net margins on sales.”
Read more – particularly about China’s rapid growth rate and the numbers of Chinese able to buy aspirational Apple products – in the full article here.
The only market Apple wants to dominate — and does, quite handily — is the market for quality customers: Those who can recognize value and who have disposable income and the proven will to spend it. General market share (market share for market share’s sake) is of no interest to Apple. Amassing cheapskates and/or the poor is a fruitless exercise better left to the patent-infringing Apple wannabes.
[Thanks to MacDailyNews Reader “Arline M.” for the heads up.]
Newsflash: Apple sells premium products at premium prices to premium customers – October 23, 2012