iPhone 4 Opening Not So Impressive For China

Posted by Zealot on Sep 26, 2010

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The iPhone 4 has finally gone on sale to China Unicom subscribers, and the opening numbers certainly look impressive on paper, especially when compared to last year’s iPhone 3 release. According to Apple, China Unicom has over 200,000 preorders for the iPhone 4 and more than 1000 people lined up at Beijing’s shiny new Apple Store for the unveiling. This is compared to just 5.,00 sold in the first 4 days for the iPhone 3 last year. Of course, the iPhone 3 was crippled in China, with the WiFi shut off. That is not the case with the iPhone 4. The price has even dropped a little, with a 32G iPhone 4 going for around $900 as opposed to $1000 for the iPhone 3.

Many blogs are following Apple’s marketing lead closely today, saying the Chinese market has finally fallen to Apple and that this promises insane profits in the coming year…however, are they really that good? One must keep things in perspective. After all, this is CHINA we are talking about.

Let’s compare the release in China with the iPhone debut in the US for example. Apple reported 600,000 preorders in the US, with likely a good deal more that didn’t manage to get through the chaos at AT&T. These 600,000 preorders were out of an estimated 300 million phone subscribers in the US with AT&T accounting for 62 million of those.

China has an estimated 600 million current mobile subscribers, double the current market of the US. In addition the penetration in China is far lower than in the US so there is also a vast untapped market that could be enticed by Apple’s new shiny. China Unicom, compared to AT&T, has 125 million subscribers two years ago, and is the third largest mobile carrier in the world today.

So in a market that is double the size of the US, with a carrier that has more than twice the subscribers of their US partner, Apple was able to get just a third of the preorders they had in the US despite a marketing blitz and enormous buzz. That is certainly an improvement over the last Apple release in China, but not exactly the world shaking results that some are touting this as. For the Chinese release to be as successful as the US one, they would have needed 1,200,000 preorders, not just 200,000. What will be far more interesting than the preorders is how sales go from here. The iPhone has had a solid if unremarkable opening in China (at least it wasn’t the flop the iPhone 3 was). Lets see if once the initial novelty has worn off and the wealthy have all bought their new status symbol, iPhone 4 sales are able to remain strong of if they will fall to Shanzhai version, which sells for about one tenth the price of the real thing.

Zealot (839 Posts) - Website | Twitter | Facebook


By day a department manager and writer for a major network device vendor...by night Zealot stalks the mean magnetic streets, striking fear into the hearts of bandwidth abusers and theme park mascots. Zealot has been involved with mobile devices for more than a decade now, starting off with dumb phones, moving to PDAs and then to smartphones, notebooks and netbooks with the odd PMP thrown in. Most of his mobile time currently is spent on a Treo Pro, Zune HD, Thinkpad T61, HP Mini 311, iPod Touch 3G, iPad 16G or a Hackintoshed Compaq Mini 704. He proudly groks the Geek community and considers himself a Neo Maxi Zune Dweebie (thanks Wil Wheaton!).

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