Apple is Doing Just Fine in China, Thank You
After a long delay, China finally approved the domestic launch of the iPhone 5. Apple shareholders would expect this to be a major event, but signs are it won’t be.
According to technology research house Gartner, Apple’s share of the mainland Chinese smartphone market slumped to below 7% in the third quarter of this year. That was a big drop, down from 12% in the second quarter.
Pretty ominous stuff, eh? Especially that bit about "a long delay." Of course, the delay wasn't Apple's doing -- that was do to apparent foot-dragging by China's Telecom Regulatory Authority. But what are those "signs" that iPhone 5 won't do well in China? Here are a few:
China Unicom (NYSE:CHU) began taking pre-orders for the iPhone 5 on Monday ahead of the new Apple (NASDAQ:AAPL) smartphone’s official launch in the country on December 14, and the carrier said it made as many as 100,000 reservations on the opening day. Rival China Telecom’s (NYSE:CHA) version will also be available on December 14, the same day that the device goes on sale on Apple’s website.
China is a key market for Apple because of the pace at which it is growing. The country contributed $23.8 billion, or 15 percent, to Apple’s 2012 fiscal year revenue, which was up 78 percent from the previous year.
Analysts have pegged a partnership with China Mobile as the next provider of large-scale growth in the country for Apple.
Apple was stuck selling last year's phone for two extra months due to Chinese bureaucrats, and is just now tapping the marketshare owned by China's largest cellular company.
You'll pardon me if I don't find any of that very ominous.