Apple (AAPL) gets close to a deal to sell iPhones in China

Posted Jun 27th 2008 4:27AM by Douglas McIntyre
Filed under: Products and Services, Launches, Apple Inc (AAPL), China, China Mobile Limited (CHL)

China is the world's largest cellular phone market. Without it, Apple's (NASDAQ:AAPL) quest to grow iPhone sales quickly would be hindered.

Apparently, however, Apple is now getting close to a deal.

According to Reuters, "Apple is no longer insisting on a revenue-sharing policy, so the biggest hurdle for China Mobile to bring in the iPhone has been cleared, but there are practical issues still to be resolved," said China Mobile (NYSE:CHL) spokeswoman Rainie Lei. Apple will not get a piece of the subscription fees attached to the phone, but it will move into a position to sell millions of iPhones on the mainland.

The news is likely to push Apple's stock up. China sales could eventually equal all of Europe's sales combined and may, at some point, rival sales in the US.

Apple's biggest problem in China may be the price of the phone. The upper and middle classes there may well pay for an expensive smartphone. The less well-off are likely to stick to products that cost well below what would be $100 in the US.

But Apple does not need to sell iPhone to all 1.3 billion people in China. It would probably be happy if just half those people bought the new 3G product.

Douglas A. McIntyre is an editor at 247wallst.com.

Tags: AAPL, Apple, CHL, inthenews, iphone

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Reader Comments (Page 1 of 1)

8-05-2008 @ 12:18PM

Constable Odo said...

Apple probably won't be able to sell more than a few million iPhones to China mainland this year, but hopefully they'll do a lot better over the next couple of years. The carrier contracts must be terribly taxing for the Chinese user.