Subscribe free to our newsletters via your
. Space Industry and Business News .




INTERNET SPACE
Chinese users welcome Apple, China Mobile deal
by Staff Writers
Beijing (AFP) Dec 23, 2013


Apple shares rise on China Mobile deal
New York (AFP) Dec 23, 2013 - Apple shares rose Monday after the company sealed a hard-won deal with China Mobile which will see the world's biggest wireless operator make the iPhone widely available to customers.

Apple shares ended 3.8 percent higher at $570.09 per share, hitting as high as $570.72 early in the session.

On Sunday, the US technology giant and China Mobile unveiled a deal to bring the iPhone to customers on a network with an estimated 760 million subscribers and until now dominated by low-cost Android smartphones.

The US company's iPhone 5s and iPhone 5c phones will be available at China Mobile and Apple retail stores across mainland China starting January 17, they said in a joint statement.

Pricing details were not announced.

Negotiations between Apple and China Mobile took years, with one key hurdle reportedly being the US firm's demand for sales volume guarantees.

"In our view, this has been the most difficult carrier agreement for Apple to negotiate in its history," said a note from Cantor Fitzgerald.

"However, we believe the opportunity for the iPhone to expand its reach within China Mobile's wireless subscriber base will prove to be well worth the wait."

Cantor Fitzgerald estimated that there are already 35 to 40 million iPhone users on China Mobile, but they use the provider's slower networks.

Sunday's deal opens up the faster network for iPhones and positions the US company to sell phones on the even-faster 4G network as its reach expands.

Cantor Fitzgerald estimated the deal could result in 20 to 24 million iPhone sales to China Mobile in 2014. Such a performance would have an earnings benefit of $4 per share.

Barclays predicted the China Mobile deal would have no impact on the upcoming quarter, but should benefit sales in the March and June quarters.

Barclays sees a "gradual" buildup in the China Mobile's faster 4G network and that Apple iPhone sales "may build over multiple quarters."

Barclays estimated the total Apple addressable market within China Mobile at 80 million units.

Chinese users welcomed a long-awaited tie-up between Apple and China Mobile, the world's biggest wireless operator, but analysts warned Monday that the deal's impact depends on the quality of the carrier's 4G network.

The US technology giant and China Mobile on Sunday unveiled the agreement to bring the iPhone to customers on a network with an estimated 760 million subscribers and until now dominated by low-cost Android smartphones.

The US company's iPhone 5s and iPhone 5c phones will be available at China Mobile and Apple retail stores across mainland China starting January 17, they said in a joint statement.

Chinese mobile phone users gave the deal a rousing ovation, hailing it as "a marathon love affair that finally came to a happy ending", in the words of one fan.

"It finally comes -- I've been waiting for so long that I'm exhausted," a user with the online handle Gluttonous Miser posted on Sina Weibo, a Chinese equivalent of Twitter.

Apple iPhones can currently be used on China Mobile's 2G network but not on its higher-speed 3G network due to a home-grown standard the carrier has adopted.

While users were generally upbeat, some raised concerns about the cost of the devices to be offered by China Mobile.

"Come on, the price must not let us down, it has to be encouraging, better not to go over 4,000 yuan ($660)," wrote another user.

The unsubsidised price of the iPhone 5c, a model with a slightly reduced cost to appeal to budget-conscious consumers and available in a range of colours, is $550 in the United States but higher in other countries, often due to tax and regulatory issues.

In China the 5c currently sells at more than $700, and the 5s goes for $870 on Apple's official China site. Apple and China Mobile said that pricing details under the new deal would be announced "at a later date".

However, analyst Ben Bajarin at Creative Strategies said he expects "some kind of subsidy" for the iPhone in China.

"Carriers know the iPhone is the best smartphone on the market at helping them sell premium services. This is why it will always be relevant," he said in a tweet.

Negotiations between Apple and China Mobile took years, with one key hurdle reportedly being the US company's demand for sales volume guarantees.

The deal gives Apple a bigger entry into the huge Chinese market, as the company is facing declining market share and seeking to counter the flood of low-cost smartphones from rivals.

Even though global iPhone sales grew 25.6 percent in the third quarter from a year earlier, growth was slower than the overall market and Apple's worldwide market share fell to 12.9 percent from 14.4 percent in the same period last year, according to a survey by market intelligence firm IDC.

But analysts said that the immediate benefit from the partnership will be limited, given that many of China Mobile's customers are already using iPhones, lessening the prospect of a sharp boost to sales.

China Mobile's stock price closed at HK$80.55 ($13.3), up just 0.8 percent, indicating investors remained sceptical about returns on the deal that are still subject to uncertainties.

The main rationale for the deal was likely both companies' strategy in the 4G era, which will allow users to -- among other things -- watch movies and play games on mobile networks at a much faster speed and in better quality, analysts said.

In the statement, Apple and China Mobile said the iPhone 5s and iPhone 5c "both offer more 4G LTE bands than any other smartphone in the world".

"The collaboration between Apple and China Mobile will give a big boost to the development of China's homegrown 4G/TD-LTE technology," it said.

China granted licences to three state-owned operators early this month to offer services on the new network, and China Mobile is rolling out the world's biggest 4G network.

"If (China Mobile's) 4G network comes online (with good quality), the impact will be rather big," Xu Zhipeng, a Beijing-based analyst with research firm Zero2ipo Group, told AFP.

However, given the operator's problem-prone 3G network, it will take time for Chinese users to build up confidence and accept the new network, he said.

"Customers may take a wait-and-see attitude towards its 4G network and will not rush to (grab an iPhone) as its price is rather high," Xu said.

.


Related Links
Satellite-based Internet technologies






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle








INTERNET SPACE
Apple, China Mobile sign iPhone deal
New York (AFP) Dec 23, 2013
Apple on Sunday unveiled a long-anticipated deal with China Mobile, the world's biggest wireless carrier, to bring the iPhone to customers in a market dominated by low-cost Android smartphones. The deal gives Apple a bigger entry into the huge Chinese market and China Mobile's estimated 760 million subscribers. The network is also rolling out the world's biggest 4G network. Under the agr ... read more


INTERNET SPACE
Europe's Gaia telescope detaches from Fregat-MT upper stage

Sailing satellites into safe retirement

Researchers Design First Battery-Powered Invisibility Cloaking Device

'Macrocells' influence corrosion rate of submerged marine concrete structures

INTERNET SPACE
Military Communication Improved as 6th Boeing-built Wideband Satellite Enters Service

Radio Gateway Connects US and Allied Troops to a Common Mobile Network

Northrop Grumman Reinvents Satellite Communications for Aircraft

US Navy Accepts MUOS-2 Satellite, Ground Stations After On-Orbit Testing

INTERNET SPACE
Orbital Launches Completes 40th Consecutive Successful Suborbital Rocket For NASA

NASA Awards Launch Services Contract for InSight Mission

Argentina successfully launches research rocket

Gaia secured inside fairing

INTERNET SPACE
Nepal uses satellite to track rare snow leopard

CSP MEMS Oscillator Paired with Mini GPS Receiver

Raytheon receives $16 million contract award for miniaturized airborne GPS receivers

USAF Awards Lockheed Martin Contract to Complete Two More GPS III Satellites

INTERNET SPACE
Cathay Pacific orders 4 more long-haul Boeing planes

China's Zhejiang Loong Airlines confirms order of 20 A320s

Northrop Grumman Expands Support For Japan E-2C Hawkeye Program

20th Anniversary of First B-2 Spirit Delivery

INTERNET SPACE
Theorists Predict New State of Quantum Matter May Have Big Impact on Electronics

Low-power tunneling transistor for high-performance devices at low voltage

Sharpening the focus in quantum photolithography

The analogue of a tsunami for telecommunication

INTERNET SPACE
Van Allen Probes Shed Light on Decades-old Mystery

Planet Labs Raises Financing

The Fantastical Life of a GIS Analyst

Brazil, China to make new satellite launch in 2014

INTERNET SPACE
One dead, seven injured by contaminated China parcels

Pollution alarm as Greeks switch to firewood for heat

Virginia Tech research overturns assumption about mercury in the Arctic

Pollution shrouds Tibetan capital, grounding flights




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement