With changes to phone sales in Japan threatening its bottom line, Apple hits out at ‘unfair’ rules

Kazuaki Nagata for The Japan Times:

Apple has been riding high in the Japanese smartphone market, enjoying the largest share of any company, but changes to the discounts mobile carriers can offer on devices starting in October could put an end to that, and the firm has strongly pushed back against the government’s move.

The U.S. tech behemoth is apparently concerned that its iPhones will lose price competitiveness and called the new rules “unfair,” as they will ban carriers and smartphone shops from significantly cutting handset prices unless they meet certain conditions — which Apple looks unlikely to meet.

In a move to lower the country’s relatively high and complex mobile phone charges, the government has decided to cap handset discounts at ¥20,000, effectively ending the practice of heavily discounting devices to prevent excessive benefits going to certain users. The new regulations will also force operators to drastically cut cancellation fees for users who quit in the middle of a two-year contract…

Despite the discount cap, the new policy will allow up to a 50 percent discount on devices 24 months after their final procurement day. If production of such smartphones is discontinued after that point, stores can sell them with an up to 80 percent discount. A 50 percent discount can be applied to phones that remain unsold for 12 months and are no longer being produced.

This would be problematic for Apple because its products do not typically meet those conditions…

MacDailyNews Take: Japan is the fourth-biggest market for Apple after the United States, Europe, and China, accounting for approximately 8% of Apple’s total iPhone sales in 2018. Hopefully, Apple’s opinion that these new rules “will take away choice from Japanese customers and result in diminished competition and higher-priced (handsets) in the market” and their proposal of a “discount condition that factors in the time since the product’s first unveiling, instead of how long it has remained unsold” are heeded and adopted!


    1. Since it applies to all companies, it may be hard to claim ‘anti-competitive’. ‘Protectionist’ may also be not fit unless it unfairly benefits domestic handsets exclusively.

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