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iPhone's high price makes it a tough sell in world's biggest phone market, China

Posted: , posted by Victor H.

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iPhone's high price makes it a tough sell in world's biggest phone market, China
China is not only the most populous country in the world, it recently surpassed the United States in number of mobile subscribers and is now also the biggest mobile market. But while in the United States, the iPhone easily dominates the scene, in China where phone subsidies are not that common a bunch of smaller local companies attract users with their much cheaper devices.

Xiaomi for once makes a phone with comparable if not better specs than the iPhone and while it runs Android, it resembles Apple's device a bit in design and has a simple interface, all for nearly half the price of the iPhone. And urban Chinese dwellers with an average salary of around $400 monthly prefer to got for this type of affordable devices.

Indystry analyst IDC data backs that up with stats saying that under $200 phones took a 40% share of all shipped phones. Luxury devices like the iPhone costing over $700 make up 11% of the market. In China, the iPhone retails for around $800.

"Apple isn't going to rule China, simply because of the limited models they have and the price points they target," IDC analyst TZ Wong said. "Based on these two factors, we do not think Apple will be the No. 1 smartphone player in China."

The Xiaomi phone is popular in China.

The Xiaomi phone is popular in China.

Again taking China's biggest success story recently, Xiaomi, we'd see that at launch its phones sell out virtually in minutes. And while you have to pay hundreds to attend Apple's big events in California, Xiaomi takes pride in charging only around 200 yuan, or just over $30 for its get-togethers, with all proceeds donated to charity.

With Windows Phone 8 soon to be out, the landscape in China will become even more hostile for the iPhone, according to analysts. Some predict that by 2016, Apple will drop below both Android and Windows. In either case, it's an interesting market to watch.

source: IDC via Reuters

  • Options

posted on 16 Aug 2012, 04:13 6

1. Veigald (Posts: 290; Member since: 13 Jan 2012)

"We do not think Apple will be the No. 1 smartphone player in China."

So? Who ever said that was Apple's goal? Apple sells devices for premium prices, not for gaining market shares.

posted on 16 Aug 2012, 08:11 5

5. -box- (Posts: 3991; Member since: 04 Jan 2012)

apple's goal is to dominate any industry they have products in, by any means they can muster

posted on 16 Aug 2012, 04:13 13

2. MeoCao (unregistered)

iPhone will be a niche device everywhere not just China. The fact it can dominate the market in the US is abnormal but I'm sure things will return to normal in the US very soon.

posted on 16 Aug 2012, 05:49 2

3. TylerGrunter (Posts: 1543; Member since: 16 Feb 2012)

It won't as far as the carriers keep up with the subsidies. That's what keeps up the market share for them. In fact as the Android phones have lower subsidies you end up giving money for the iPhones when buying Android devices in the carriers.
As soon as they stop with this distorsion of the market the iPhone market share will drop.

posted on 16 Aug 2012, 06:20 8

4. ogy_dogy (Posts: 453; Member since: 29 Jun 2012)

Finally a country where common sense prevails. Its just not normal for someone to buy a weaker and far more expensive phone over a cheaper and faster one. Its just a matter of time till this trend spreads...

posted on 16 Aug 2012, 08:13 1

6. -box- (Posts: 3991; Member since: 04 Jan 2012)

I could really get behind a company like Xiaomi, just based on the second-to-last paragraph alone, and also because their devices actually look well-executed (especialy the shape and colors, reminds me slightly of Nokias and some Sonys, not at all apple) and are obviously popular with a populace that places actual value over superficiality, especially when value is so much more cost-effective

posted on 16 Aug 2012, 12:04

7. mas11 (Posts: 1034; Member since: 30 Mar 2012)

That's because it's so freaking over-priced. If another company manufactured and sold the exact same phone with their own software it would be considered a mid-range device and go for $0-$100 w/ a contract. Without maybe $400-$450.

posted on 16 Aug 2012, 15:08

8. OSFantasma (Posts: 119; Member since: 27 Sep 2011)

Xiaomi i need you were going to start making headlines i hope you start selling your phone globally.. also i want to see Meizu do similar acts. the more competition the world has the better for the world consumers i remember reading about a Russian Oem Making Nice phones as well but i forget what name it had..

posted on 16 Aug 2012, 20:45

9. OptimusOne (Posts: 694; Member since: 22 May 2012)

i love miui

posted on 17 Aug 2012, 02:20

10. JunkCreek (Posts: 407; Member since: 13 Jul 2012)

things became like an old days. premium device had premium os, premium hardware, premium specs, premium feature and also premium functionality. not noawadays premium only sells names/brands with no premium inside.

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