Apple China Mobile iPhone Deal is in Trouble

Sep 5 2013, 1:20pm CDT | by , in News | Apple

Apple China Mobile iPhone Deal is in Trouble

Will the new iPhone deal between Apple and China Mobile be done or not? Will Apple lower the price of its new iPhone as China Mobile demands concessions or the deal will only be done for low-cost plastic iPhone?

Apple is all set to launch its new iPhone on September 10th. A low-cost plastic iPhone 5C is also expected to be launched with new iPhone 5S on same day. But the question arises about the launch of its both iPhone models in world's largest smartphone market of China. Apple is holding a separate launch event for China on September 11th. But what about its iPhone deal with China's largest network carrier? Bloomberg's recent report has done some speculations about the new iPhone retail deal with China Mobile.

The major issue between both giants is the price of the device. Like Edward Zabitsky, chief executive officer of Toronto-based ACI Research, said, "“In this relationship, China Mobile has all of the power. China Mobile will offer the iPhone as soon as Apple gives in on price.” China Mobile is the largest carrier of the country having 63 percent of the country’s 1.19 billion wireless accounts. So Apple must need an agreement with China Mobile is it wants to compete with rival and current China market leader Samsung. 

What about the price then? Apple wants to launch iPhone 5 in between 5,288 yuan ($864) to 6,888 yuan in China. This price is double than Lenovo's K900 IdeaPhone which is now at no.2 in terms of sales in China after Samsung. So China Mobile concerns about price look right. An analyst at Avondale Partners LLC., John Bright said, “Apple’s unwillingness to provide meaningful concessions and China Mobile’s unwillingness to subsidize a high-cost device have inhibited a deal until now. A lower-cost iPhone, financially accessible to a greater proportion of China Mobile’s customer base, could be a middle ground.”

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