Apple iPhone falls flat in China on opening weekend: Lost in translation?
Filed under: Company News, Technology, Apple
It's a concept that Apple (AAPL) is not that familiar with of late: failure. China Unicom, the service carrier that launched Apple's iPhone in China last week, reported it had signed up an anemic 5,000 new users over the weekend, a marked departure for a product that has enjoyed blockbuster launches in the United States.Broadpoint AMTech analyst Brain Marshall wondered whether there might have been a translation error, but both Bloomberg and Reuters were reporting the same numbers from China Unicom.
"If it's true, it's pretty disappointing," Marshall told DailyFinance. "I would have expected a bigger splash over the weekend."
"There is a gray market of unauthorized handsets there as well, which may have contributed to it," Marshall added. "But I don't have any doubt about the iPhone being successful in China."
The lackluster sales demonstrate that vast swaths of China's 710 million-strong mobile-phone base cannot afford the device, launched last week at some 1,000 "points of sale."
Nevertheless, after a Unicom shareholders meeting in Hong Kong today, China Unicom President Lu Yimin told reporters that the prices of the handset are not expensive.
Apple could try aiming lower ... but probably won't
As previously noted, the cost of the phone is prohibitive for many in a country where the the per capita GDP is about $5,400. The state-owned China Unicom's non-service bundled iPhone is going to start at $732. Meanwhile, the most expensive data plan is going to cost over $3000 per year.
"At the end of the day, Apple is a high-end consumer products company," Marshall said. "The average person in China isn't as wealthy as a person in a developed country." He added that it would make sense for Apple to try to market a lower-priced product in the Middle Kingdom, but he doubts it will, because it hasn't been the company's strategy in the past.
In another problem, the Chinese iPhone can't take advantage of Wi-Fi hotspots, despite the fact that China's quasi-communist central government lifted restrictions on Wi-Fi in May.
PC World had reported that iPhone sales got off to a slow start on Friday night, the first day they were available. "Smog hung in the Beijing air as buyers filled about two-thirds of an outdoor sales queue set up at a shopping mall. Beijing's first rain in weeks fell on an overhead canopy during the event," the website reported.
Still, Marshall believes the iPhone will eventually be a hit in China. "It will take a little bit of time," Marshall said, "but they'll get there."
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Reader Comments (Page 1 of 1)
11-03-2009 @ 7:57PM
Greg said...
Obviously the Chinese need an Asian equivalent of Madison Avenue to teach them what's hot and what's not. Here in America we have billions of dollars spent to show us what we should buy. Without that edge, the Chinese might look at an iPhone and thinl "Gee, another cell phone; but look how expensive. The one I bought lets me talk and get Internet acces, but it doesn't have all that expensive crap on it."
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11-03-2009 @ 11:09PM
omglol said...
I hate people using this section for an add... What a low life.
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11-04-2009 @ 12:07AM
Average White Boy said...
You can't blame people for not buying what they can't afford. Maybe the Chinese aren't like Americans who are always spending what they don't have. The iPhone didn't do well in India or Russia, either. Let's face it, the poor have little money to spend and nothing can be done about it. We talk about Apple in the U.S., but in China they probably no nothing about Apple. They probably know far more about Microsoft. I'm sure that 5,000 iPhones sold was still a lot of sales compared to other smartphones that are available. I think it will take a long time for the Chinese to catch on, if ever. I guess the iPhone is just another expensive piece of American crap to them.
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11-04-2009 @ 12:18AM
F China said...
Our corrupt politicians and corporations send all of America's jobs to China's slave factories and they can't even afford an iPhone. In the new America that's coming from the great upheaval, we are getting back those America manufacturing jobs and China can go F itself with an iPhones if it doesn't like it.
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11-04-2009 @ 3:41AM
eltai said...
Well i own one, and if i know then what i know now,i would of never bought it..i would of got another blackberry. for one the messaging sucks.you get a video message you can see the thumbprint playing the video, but when you touch it to show it play in normal size ,it doesn't,it shows it as a picture.And when you save a video,it saves as a picture. and it doesn't play the sound with the video it's separate. it's sucks. its the dumbest phone i have ever owned..the only thing nice is the applications..Don't buy you will regret it..
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11-04-2009 @ 6:19PM
ben said...
i think iphones ,itouch are great and worth it . happy with evreything. cannot believe all the applications. i love it good buy for me
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