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| China Mobile's Apple iPhone preorders hit 1.2m as Xiaomi and Huawei rise | China Mobile's Apple iPhone preorders hit 1.2m as Xiaomi and Huawei rise |
| (35 minutes later) | |
| China Mobile, the world's biggest wireless carrier, has received 1.2m pre-orders for Apple's iPhone, which goes on sale through it for the first time on Friday, the company says. | China Mobile, the world's biggest wireless carrier, has received 1.2m pre-orders for Apple's iPhone, which goes on sale through it for the first time on Friday, the company says. |
| The figure suggests a dramatic rise in iPhone sales there, as Apple typically sells about two million phones a month in a country with more than 630 million smartphone owners, where an average of about 23m smartphones will be sold each month in 2014. | The figure suggests a dramatic rise in iPhone sales there, as Apple typically sells about two million phones a month in a country with more than 630 million smartphone owners, where an average of about 23m smartphones will be sold each month in 2014. |
| Tim Cook, Apple's chief executive, called the deal "a watershed day" in an interview with CNBC and praised China Mobile as a company with a "very fast network". He added that there are already 500,000 iPhone app developers in China. | Tim Cook, Apple's chief executive, called the deal "a watershed day" in an interview with CNBC and praised China Mobile as a company with a "very fast network". He added that there are already 500,000 iPhone app developers in China. |
| However the rapid growth in the broader Chinese smartphone market is putting pressure on the existing leader, Korea's Samsung. China's Xiaomi outsold Samsung to become the country's top-selling smartphone brand in December, according to an upcoming report from the research company Kantar ComTech, taking 21.7% of the market against the Korean company's 19.1%. | However the rapid growth in the broader Chinese smartphone market is putting pressure on the existing leader, Korea's Samsung. China's Xiaomi outsold Samsung to become the country's top-selling smartphone brand in December, according to an upcoming report from the research company Kantar ComTech, taking 21.7% of the market against the Korean company's 19.1%. |
| In an interview with press in China, reported by the Wall Street Journal, Cook said that the significance of the deal was that "it allows us to take the iPhone to a different level, to marry it with the fastest network, with TD-LTE [the protocol used by China Mobile's 4G network] for the very first time… this is a big deal, it's huge, and so I couldn't be happier with how we're doing." | In an interview with press in China, reported by the Wall Street Journal, Cook said that the significance of the deal was that "it allows us to take the iPhone to a different level, to marry it with the fastest network, with TD-LTE [the protocol used by China Mobile's 4G network] for the very first time… this is a big deal, it's huge, and so I couldn't be happier with how we're doing." |
| Cook also said that Apple had sold more iPhones in China during the Christmas quarter than ever before, but couldn't specify figures because the company is in the quiet period before announcing its quarterly results. Apple has never broken out iPhone sales in China. Kevin Restivo of the research company IDC said that Cook's comment suggested sales there of more than 10.4m units - the previous quarterly maximum achieved in the first quarter of 2012. | |
| Meanwhile, the Chinese networks and handsets company Huawei said that it had shipped 52m phones in 2013, and was aiming for 80m in 2014. Companies such as Huawei, ZTE and Xiaomi are all targeting upmarket segments as they search for profit, creating a direct challenge to Samsung. | Meanwhile, the Chinese networks and handsets company Huawei said that it had shipped 52m phones in 2013, and was aiming for 80m in 2014. Companies such as Huawei, ZTE and Xiaomi are all targeting upmarket segments as they search for profit, creating a direct challenge to Samsung. |
| Apple is to some extent insulated from Chinese rivals' onslaught because it still has a high brand cachet among users - and a price to match. The 16GB iPhone 5S, the higher-end model which incorporates a fingerprint reader, will sell for 5,288 yuan ($874) on China Mobile - compared to the typical smartphone price in China of around $100. | Apple is to some extent insulated from Chinese rivals' onslaught because it still has a high brand cachet among users - and a price to match. The 16GB iPhone 5S, the higher-end model which incorporates a fingerprint reader, will sell for 5,288 yuan ($874) on China Mobile - compared to the typical smartphone price in China of around $100. |
| Some analysts think that the availability of the iPhone on China Mobile will take sales away from Samsung among buyers prepared to buy foreign handsets. They reckon that the China Mobile deal could add between 12m and 20m extra iPhone sales in 2014. | Some analysts think that the availability of the iPhone on China Mobile will take sales away from Samsung among buyers prepared to buy foreign handsets. They reckon that the China Mobile deal could add between 12m and 20m extra iPhone sales in 2014. |
| According to the research firm Strategy Analytics, Xiaomi only entered the top five smartphone vendors in China for the first time in the third quarter of 2013. But its "flash" sales, where it announces handsets for rapid sales, have driven huge customer loyalty and excitement. | According to the research firm Strategy Analytics, Xiaomi only entered the top five smartphone vendors in China for the first time in the third quarter of 2013. But its "flash" sales, where it announces handsets for rapid sales, have driven huge customer loyalty and excitement. |
| Broad agreement | Broad agreement |
| The figure of 1.2m iPhone orders broadly agrees with a figure quoted on Tuesday by the Wall Street Journal, which said that Foxconn had shipped 1.4m top-end iPhone 5S handsets to the carrier. | The figure of 1.2m iPhone orders broadly agrees with a figure quoted on Tuesday by the Wall Street Journal, which said that Foxconn had shipped 1.4m top-end iPhone 5S handsets to the carrier. |
| While the iPhone 5S and 5C have been on sale through the other two Chinese networks, China Unicom and China Telecom, since last year, China Mobile has a total subscriber base of more than 760m, compared to more than 465m for the other two combined. However China Mobile has only 181m 3G subscribers, compared to a combined total of 221m at the other two companies - and is trying to drive up the number who use data services to grow revenues. | While the iPhone 5S and 5C have been on sale through the other two Chinese networks, China Unicom and China Telecom, since last year, China Mobile has a total subscriber base of more than 760m, compared to more than 465m for the other two combined. However China Mobile has only 181m 3G subscribers, compared to a combined total of 221m at the other two companies - and is trying to drive up the number who use data services to grow revenues. |
| Apple has previously been locked out of selling phones on China Mobile because the two companies could not agree a revenue-sharing deal on handset sales, and because the iPhone was incompatible with the TD-CDMA data system used on the carrier for its 3G services. | Apple has previously been locked out of selling phones on China Mobile because the two companies could not agree a revenue-sharing deal on handset sales, and because the iPhone was incompatible with the TD-CDMA data system used on the carrier for its 3G services. |
| There are an estimated 10m iPhone users on China Mobile's network already using older phones, but they cannot get data services because they are incompatible with its protocols. | There are an estimated 10m iPhone users on China Mobile's network already using older phones, but they cannot get data services because they are incompatible with its protocols. |
| But with the 5C and 5S it has introduced new chips capable of working both with that system and the forthcoming TD-LTE system, licensed in November 2013 by the Chinese government. | But with the 5C and 5S it has introduced new chips capable of working both with that system and the forthcoming TD-LTE system, licensed in November 2013 by the Chinese government. |
| Cook said that the deal with China Mobile, which has been expected ever since Apple began selling iPhones in China, "came together fairly quickly" once the iPhone 5S and 5C were available. | Cook said that the deal with China Mobile, which has been expected ever since Apple began selling iPhones in China, "came together fairly quickly" once the iPhone 5S and 5C were available. |
| • China and India will together have 1.2bn smartphone owners by the end of 2014, research says | • China and India will together have 1.2bn smartphone owners by the end of 2014, research says |
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