Apple Finally Signs The China Mobile Deal
THE financial markets have been waiting for this for some years: for Apple to sign up with China Mobile to take the iPhone. The importance of it is that China Mobile is the last major airtime provider around the world that doesn’t currently carry Apple’s products. And with 760 million subscribers that’s a hell of a market that Apple is missing out on. The deal has finally happened:
Apple® and China Mobile today announced they have entered into a multi-year agreement to bring iPhone® to the world’s largest mobile network. As part of the agreement, iPhone 5s and iPhone 5c will be available from China Mobile’s expansive network of retail stores as well as Apple retail stores across mainland China beginning on Friday, January 17, 2014.
There were two reasons the deal didn’t happen before now. The first was that Apple just didn’t make a phone that would work on that network….it uses a different technology from everyone else called TD-SCDMA. That’s their version of a 3G network. They’re rolling out a 4G network now, which the iPhone does work on: and also Apple has made a phone that works on TD-SCDMA. So, no technical reason why the deal shouldn’t go through and this has been true once September.
Photo: Chinese women use a non-Apple brand phone to take a photo of themselves outside the Apple retail shop in Beijing.
The other reason was simple business. Apple demands that an airtime provider makes larger orders, insists that they pay for those orders whether they sell them or not, demands that they provide substantial subsidies to buyers and that they spend a certain (large) amount on advertising and marketing. China Mobile was balking at all four of those. Y’know, if we’re giving you access to our 760 million customers then why are you demanding that we cough up all that cash?
That also seems to have finally been settled. And this the iPhone will now be for sale on the world’s largest mobile network. It’ll be interesting to see what happens to the Apple share price when New York opens in a few hours….