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China Unicom to pass on the next iPhone, says too much subsidies and network upgrades are hurting

Posted: , posted by Daniel P.

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China Unicom to pass on the next iPhone, says too much subsidies and network upgrades are hurting
China Unicom was the first Chinese carrier to joyfully offer the iPhone 4 when it was introduced, signing a test 2-year contract with Apple in 2010 that expires next month. 

Unfortunately this hasn't turned out the bonanza it thought it would be, as huge subsidies for the device, and heavy investments in network infrastructure to cope with the surge in wireless data demand have damaged its bottomline.

That's why China Unicom is reported to pass on renewing the contract with Apple for postpaid sales of the iPhone 4S or the next iPhone, as it realized most of the profit has gone to Apple instead of to the carrier by the end of the contract. It is the second largest Chinese carrier, though, so if Apple signs up a juggernaut like China Mobile for the sixth generation iPhone, the China Unicom decision shouldn't make that much of an impact on its sales in that all important neck of the woods.

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