No talks held between Apple, China mobile over current iPhone

Contrary to earlier reports, Apple and China Mobile have not yet entered into negotiations to bring the iPhone to the world's largest mobile network, suggesting such talks are only likely closer to the release of a 3G version of the touchscreen handset later this year.

"We have not yet officially begun talks with Apple over the iPhone problem," China Mobile Chief Executive Wang Jianzhou told a group of reporters this week. "As long as our customers want this kind of product, we will keep all options open."

In January, Reuters cited a spokesperson for the Chinese carrier as saying that the two firms had "terminated talks," a notion later disputed by Apple chief executive Steve Jobs, who insisted that those reports were simply untrue.

Separately, AppleInsider has heard rumblings that such negotiations are only likely to manifest closer to the release of a 3G-equipped iPhone, as Apple will reportedly forgo any plans to launch the slower, first-generation handset in the vast and competitive Chinese market at current pricing.

As of last month, China Mobile maintained a subscriber base in excess of 375 million — more than the population of the United States and by far the largest in the world. Additionally, its said to be providing service to some 400,000 first-generation iPhones that have been unlocked and smuggled into China for those subscribers unwilling to wait on official availability.

Still, several obstacles are expected to stand in the way of an official iPhone rollout in China, mainly that the device currently fetches more than twice the monthly salary of the average Chinese worker, and that Chinese carriers such as China Mobile are unlikely to see eye-to-eye on Apple's revenue sharing demands.

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15 Comments

echosonic

said about 16 years ago

Oh boy. 375 mil. I didn't realize....wow.

solipsism

said about 16 years ago

? What kind of networks do they currently have?

? Do they also stream television like the Japanese networks?

? Do they offer unlimited data for a reasonable price?

? Does the vast size of the market indicate Apple is more likely to give in -or- that fact that 1/10th of all iPhones sold last year were run on China's network mean the carriers are more likely to give in?

? While the majority of population can't afford such a device, what percentage of the population can?

? How important are status symbols to the Chinese?

I think Nvidia2008 is in China. Anyone else with knowledge of the market abel to answer my questions?

ak1808

said about 16 years ago

In other news:

No brown iPod nano announced
iTouch not released
No further delay on iPhone SDK

melgross

said about 16 years ago

Quote:

Originally Posted by solipsism

• What kind of networks do they currently have?

• Do they also stream television like the Japanese networks?

• Do they offer unlimited data for a reasonable price?

• Does the vast size of the market indicate Apple is more likely to give in -or- that fact that 1/10th of all iPhones sold last year were run on China's network mean the carriers are more likely to give in?

• While the majority of population can't afford such a device, what percentage of the population can?

• How important are status symbols to the Chinese?

I think Nvidia2008 is in China. Anyone else with knowledge of the market abel to answer my questions?

While I don't remember the details about the service I read in a WSJ article a few weeks ago about this, I do remember that it said that the Chinese buy very expensive phones, and that price is not much of an issue. We can see the truth of that by the fact that over 400,000 iPhones are already in their hands. That's without the 3G, and at much higher prices than they would otherwise cost if imported legally.

I wouldn't be surprised if the Chinese could (would?) be the largest market for them.

As far as negotiations go, from my own experience in business over 35 years, I can say that companies negotiate informally all of the time, and then deny they are in talks. That's easy to do if the talks haven't risen to a formal level. It's very doubtful that they and Apple haven't also been informally talking. There is no way that both could wait until just before a 3G model comes out before commencing talks. That would put too much pressure on both sides to come to a quick agreement.

As both do know that this 3G model is coming out, and no doubt have communicated about when it will happen, there isn't even a reason not to have been talking. I simply don't believe either side if they say they haven't been feeling each other out about this, as it would be a very large deal for both. I also believe the report that said that China Mobile didn't revenue share. This will likely be the sticking point.

Status symbols are very important there. At this point in time, with a rapidly increasing middle and upper middle class, an expensive phone is one of the cheapest status symbols available. Foreign products are desirable, as they are everywhere, and because they are exotic. The Chinese are only, in the last few years, seeing large amounts of foreign products. Interestingly enough, even though they are made there, they are still an american product, and the Chinese are fascinated by America. Other than the Cold War, the US has not had the adversarial relationship with China that other world powers had over the past few centuries, so thinking about the US is different than it is for the Colonial Powers.

melgross

said about 16 years ago

To support my contention that Apple and China mobile have been talking, despite denials, this article in ARs has a quote from a CM official, Chief Executive Wang Jainzhou (who should know):

"We have not yet officially begun talks with Apple over the iPhone problem."

Note the word "officially".

Article:

http://arstechnica.com/journals/appl...open-to-iphone