What the China Mobile deal means for Apple
The huge carrier will finally begin selling the iPhone, further cementing a market CEO Tim Cook has worked hard to woo. But there's still the problem of price.
By Tim Parker
With little fanfare, it finally happened.
With more than 760 million subscribers -- significantly larger than Verizon (VZ) -- China Mobile represents a huge win for Apple (AAPL). It's no wonder that CEO Tim Cook, normally not one for lengthy comments to the press, had so much to say.
"Apple has enormous respect for China Mobile and we are excited to begin working together," he said. "China is an extremely important market for Apple and our partnership with China Mobile presents us the opportunity to bring iPhone to the customers of the world's largest network."
China Mobile Chairman Xi Guohua was equally excited. "Apple's iPhone is very much loved by millions of customers around the world," he said.
The other key player in the deal, Wall Street, seemed happy as well. Shares of Apple rose nearly 3% in Monday morning trading to top $565.
How big is the deal?
Dow Jones cited reports prepared by analysts that estimated 2014 sales at 39 million in China alone. This compares to 34 million units sold worldwide in the most recent quarter. That would represent a 25 percent increase in units sold each quarter next year.
There's still the problem of price.
According to CNBC Asia reporter Eunice Yoon, it costs about $850 to purchase from grey market vendors and China Mobile's competitor, China Unicom (CHU), currently offers the iPhone for free when customers purchase about $1,000 worth of minutes. She says China Mobile will have to offer a package at least as competitive as China Unicom's current package.
Despite the criticism that the iPhone will be too expensive for most China customers, demand is expected to be strong, according to Yoon.
At the time of this writing, Tim Parker was long Apple.
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'bout time they can start selling the same devices to the slaves that manufacture them.
I PERSONALLY try NOT TO BUY ANYTHING MADE IN CHINA OR S E ASIA. Pretty soon the only jobs in the U.S. WILL BE FAST FOOD JOBS! GUESS I WON'T BE BUYING AN APPLE NEW ANYTHING /SOON! BRING OUR JOBS BACK TO THIS COUNTRY OR BOYCOTT THE COMPANIES THAT SHIP WORK OVERSEAS! TOO MANY SHEEP IN THIS COUNTRY!! THE ONLY GOOD THING CHINA DOES IS ONE CHILD PER FAMILY THEY KNOW WE ARE OVER-POPULATED BY BILLIONS! TOO MANY PEOPLE NOT ENOUGH JOBS IN THE U.S.
how many iphone purchases will be made not by individual Chinese consumers, but instead by Chinese corporations for their employees?
1st Answer.... Millions.
2nd answer... way too many for me to consider selling my APPL shares
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