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 In a deal that could add billions of dollars to its revenue, Apple
said its smartphones will be available to China Mobile customers
starting January 17. Pricing and availability details for the iPhone
5S and 5C lines will be disclosed at a later date, it said in a
statement.
China Mobile, which has about 760 million customers, will begin
registering orders for iPhone from December 25, the company said on
its account on the Sina-Weibo micro-blogging service.
The tie-up provides a much-needed boost for Apple in a country where
it's trailing rivals, even though China is its second-largest market
after the U.S. It will also give Apple extra firepower in its
intensifying global competition with South Korea's Samsung
Electronics Co Ltd.
Apple didn't disclose financial terms of the agreement. Tim Cook,
Apple's chief executive, said in its statement that China is an
extremely important market for the Cupertino-based company.
In a country where smartphone sales are booming, Apple has trailed
its competitors. Shipments of iPhones in the country grew 32 percent
year-on-year for the third quarter, about half of China's Lenovo
Group Ltd, which had the next slowest growth at 64 percent
year-on-year.
SAMSUNG BATTLE
China Mobile could gain 17 million new iPhone activations in 2014
alone, according to research firm Forrester — more than the 16.8
million iPhones Apple sold in mainland China for the 12 months ended
September, according to Forrester data.
But after an expected initial surge, Apple is likely to find itself
back in a costly marketing battle with Samsung Electronics. The
deal has been years in the making, with numerous visits by Apple to
the state-owned carrier's Beijing headquarters. Negotiations have
been tricky, in part because of disagreements over details like
revenue-sharing, analysts have said.
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China Mobile was the only Chinese carrier not to offer customers the
iPhone up to now due to compatibility issues with the carrier's 3G
wireless technology, known as TD-SCDMA.
On December 4, Chinese regulators awarded 4G wireless licenses to
China Mobile Ltd, China Unicom Hong Kong Ltd and China Telecom Corp
Ltd, removing the final stumbling block to a deal that industry
observers had long expected. The latest iPhone models support 4G
technology known as TD-LTE.
China Mobile estimates it does already have about 45 million iPhone
users on its network. But these subscribers can only use the
company's slower 2G wireless speeds because of the incompatibility
with its proprietary 3G technology.
Shares of Apple closed at $549.02 in New York on Friday. In Hong
Kong, China Mobile shares were up 1.3 percent at midday on Monday,
outperforming the broader Hang Seng index which was up 0.7 percent.
(Reporting by Ryan Vlastelica in New
York and Paul Carsten in
Beijing; additional reporting by Adam Rose in Beijing; editing by
Gary Crosse and Kenneth Maxwell)
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