Tim Cook Tries to Fix Apple’s China Syndrome

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Apple's CEO Tim Cook was in China on Tuesday, meeting with two of China's major mobile carriers. He met with China Mobile, the world's largest mobile carrier, a company that does not currently carry the iPhone. He also met with China Telecom, a company Apple does work with, to talk about future products. Recently, Apple has seen a 43 percent slump in sales in China as a whole.

According to Reuters, Tim Cook met with China Mobile Chairman Xi Guohua in Beijing to discuss cooperation between the companies. So far, China Mobile has resisted Apple products on their vast network. One hold-up has been the slow adoption of 3G and China Mobile's use of of a homegrown wireless technology.

Mr. Cook also met with Yang Jie, China Telecom's President to also discuss future products. Apple has been doing business with China Telecom since early 2012. That company has a 50 percent adoption of the world-wide 3G standard that the iPhone uses.

China is an important market for Apple and has huge growth potential. That market accounted for 13 percent of Apple's revenue last quarter, but sales have declined recently as China, with the help of low cost handset rivals, seeks to gain more control of its own wireless industry.

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Apple and China's telecoms have been good for each other so far. However, China's desire to create its own homegrown industry seems to be balanced against its need to upgrade its networks and seed their market with Apple's highly desirable state-of-the-art products. For now, the arrangements have been beneficial.  It remains to be seen if Tim Cook can convince China Mobile that they need to be on Apple's bandwagon now and for the long term.

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Comments

Lee Dronick

  Apple has seen a 43 percent slump in sales in China as a whole.

Maybe there is something to the rumor of a lower priced iPhone so that it can compete with whatever cheap smart phones that the Chinese are buying. If so I wonder what features it will not have when compared to a full priced iPhone. 

 

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