After six years of negotiating, Apple and China Mobile reached an agreement to sell iPhones in China. That agreement was reached back in December, and today marked the very first day the iPhone 5 and 5c were on sold through China Mobile, China’s largest carrier.
Through the years, Apple scored deals with the second- and third-largest carriers but still found that they were losing out to Samsung Electronics when it came to smartphones. The New York Times notes that the market share in China has fallen into single digits for Apple.
Foreign brands were first portrayed as superior to domestic brands, but lately state-run media has cast foreign brands in poor light. The managing editor of the China Market Research Group remarked, “Apple used to be the must-have, aspirational brand for all wealthy and middle-class Chinese consumers. But over the last year, there has been a real deterioration of the Apple brand.”
Apple has some ground to make up. But it will be an uphill battle. The cost of an iPhone is more than most people’s monthly salary at 5,288 renminbi ($875) and some users of microblogging service Sina Weibo noted that they could get a cheaper model smuggled from Hong Kong. Analysts also say that Apple products don’t necessarily appeal as much to Chinese consumers because they prefer devices with bigger screens, like the Samsung Note 3, with a 5.7-inch screen.
China Mobile had previously reported that there were more than 1 million pre-orders via China Mobile’s website. Analysts from Hong Kong estimate that China Mobile will sell 10 million iPhones this year. However, when you’re dealing with a population of more than one billion mobile customers, that number isn’t as large as you might think.
Though ultimately, this deal is what Apple wanted, they’ll have to work much harder to try at take a larger market share in China, and that will involve creating products specifically for that market.