After years of negotiations, China Mobile Chairman Xi Guohua, and Apple CEO, Tim Cooke, sat down for the first time with smiles on their faces as they got ready to launch the iPhone 5S within the country. With the deal finalized, it appears the effort will pay off as Xi Guohua says millions of iPhones have already been pre-ordered by customers, two days before the official launch on January 17, 2014.
Speaking to the Wall Street Journal, Apple CEO Tim Cook said he's "incredibly optimistic" about the deal struck with China Mobile. "There are lots more things our companies can do together in the future," said Cook, who attended the China Mobile iPhone launch in Beijing.
A deal with China Mobile could allow Apple to regain lost market share from Korean and Chinese manufacturers in the world's largest mobile phone market.
However, will the iPhone fly off the shelves? Responses have been mixed. While the Wall Street Journal reports Xi Guohua as saying that millions of iPhones have been pre-ordered by customers to date, CNBC's Eunice Yoon made a different statement. Yoon claims that China Mobile has received only 1.2 million pre-orders so far, which translates to 60,000 pre-orders per day. Whatever the case, the number is still impressive, probably more than what Apple had expected before going into this deal with China Mobile.
A December survey suggested that Apple could sell between 5 million and 39 million iPhones in China in 2014. That's a huge number, but not exactly impossible for Apple since China Mobile is the largest mobile phone carrier with over 760 million subscribers. However, the company has its task cut out because rival Samsung, HTC, Lenovo, Huawei and Xiaomi will not want Apple to steal their market share.
Another problem Apple has to overcome is pricing the China Mobile version of iPhone right, because even a subsidized iPhone with a 2-year contract isn't quite affordable. The iPhone 5s 16GB version is being given away for free at China Mobile with a 2-year contract of 588 yuan ($97) per month. In comparison, as The Next Web points out, China Unicom is giving away the iPhone 5s free for a 30-month 386 yuan ($63) plan, while China Telecom has subsidized the iPhone 5s' cost for a 2-year 389 yuan ($64) per month plan.
