Apple has struck a deal announced with China Unicom, the country’s second-largest mobile service provider, to become the first authorised seller of the iPhone in China. The deal opens up a huge new market to Apple. China now has nearly 700 million mobile phones in use, almost as much as the next two largest mobile […]
Apple has struck a deal announced with China Unicom, the country’s second-largest mobile service provider, to become the first authorised seller of the iPhone in China. The deal opens up a huge new market to Apple. China now has nearly 700 million mobile phones in use, almost as much as the next two largest mobile nations, India and the US, combined. China Unicom had 140 million mobile subscribers by June. The interest appears to be there, with prices in a thriving black market in China set as high as nearly 5,000 yuan for each iPhone.
The Chinese market is strategically important for iPhone in many ways. It’s not simply the size of the telco market today, and its explosive growth that has been only slightly dented by the recession. It’s important in both locking out Nokia, HTC, Samsung and other global competitors, and in heading off local competition from the rapidly expanding Chinese consumer electronics sector.
The three year deal ensures a lock-in that protects Apple and strengthens Unicom’s hand. Evidence from many countries shows a direct correlation between the winner of the iPhone contract and the carrier that enjoys strong new customer acquisition.
Apple have succeeded in creating a product with such strong consumer pull that people will switch carriers just for the handset. As rivals upweight their handsets to match iPhone in functionality and user-intrface, the battleground will move to the applications consumers can download. Again China emerges as strategically key for Apple.
The success in the UK and US markets triggered a massive wave of apps development as programmers got to grips with designing for iPhone. If Apple get the same energy in the Chinese market, then their second wave of sales in 2010 and 11 will be built on the apps consumers begin downloading this year.
Beyond the core Apple fanbase, wider consumer loyalty to the device and the brand will hinge on the consumer experience of using the apps and letting the phone shape a place for itself in the consumers’ daily lives – a place that goes far beyond SMS, Facebook, Calendars, Contacts and Voice.
www.chinaunicom.com
