Apple's iPhone loses market share in China

Apple's iPhone loses market share in China
Published: 17 February 2012 (1542 Views)
Apple Inc's share of China's booming smartphone market slipped for a second straight quarter in October-December, as it lost ground to cheaper local brands and as some shoppers held off until after the iPhone 4S launch last month.

China, the world's largest mobile phone market, has not been easy for Apple, which is grappling with a lawsuit from a local firm over the iPad name and issues at its suppliers' factories over wages and working conditions.

With the number of mobile subscribers set to top 1 billion in China this year, there is cut-throat competition among South Korea's Samsung Electronics Co Ltd, Nokia, Apple and local firms Huawei Technologies Co Ltd and ZTE Corp.

While Apple regained its top spot as the world's largest smartphone vendor in the fourth quarter and for last year as a whole, it slipped to 5th place in China, overtaken by ZTE. Apple's China smartphone market share slid to 7.5 percent from 10.4 percent in July-September.

In the last quarter, Samsung knocked Nokia off the top slot, taking 24.3 percent of the market, more than three times Apple's share, data from research firm Gartner showed. Nokia's market share more than halved last year, from above 40 percent in the first quarter to below one fifth by the fourth quarter.

"Chinese handset makers have been actively promoting their smartphones with China's three telecoms operators, so we saw ZTE and Huawei gain significant market share," said Taipei-based Gartner analyst CK Lu.

Gartner said this week it expected Apple's iPhone market share to slip for a couple of quarters as the novelty of its latest 4S model wears off.

In the first quarter of last year, ZTE had a market share of just 3 percent, but ended 2011 ranked 4th with more than 11 percent market share.

Chinese firms are gradually shifting up towards the higher end of the market, unveiling more feature-packed smartphones.

"If you want to sell handsets to the mass market, a simple rule of thumb in China is that the handset price has to be close to 70 percent of the monthly salary," said Jayesh Easwaramony, an analyst with Frost & Sullivan in Singapore.

"Today, an iPhone is more than two months salary."

This, said Easwaramony, gives the likes of Huawei and ZTE the opportunity to cater to a mass market that is captivated by the iPhone, but doesn't have the purchasing power for it.

VALUE FOR MONEY

"The quality of Huawei's phones is quite high and it's good value for money compared to the iPhone," said Dale Dai, a 28-year-old sales executive from Beijing.

Dai, who uses his Huawei phone to write weibo, or Chinese microblogs, surf the Internet and make calls, recently bought a new Honor smartphone for 1,800 yuan ($290), almost a third of the price of a new iPhone 4S at 4,988 yuan.

But given the sheer size of the Chinese market, just targeting the highest end users should be enough for Apple, though it's not always been a smooth ride.

Last month, shoppers in Beijing threw eggs at the Apple store and fought with police when they were told the iPhone 4S would not be on sale as scheduled.

In Shenzhen, some genuine iPhones and iPads are smuggled in from Hong Kong, while sellers also take advantage of Apple's popularity by packaging fake iPhones in iPhone 5 boxes - even before the 4S was launched.

In Hong Kong, Apple resorted to an online lottery reservation system for the 4S model after crowd control issues disrupted initial sales.

Analysts expect Apple to stem its slide in market share in China by signing up another carrier.

China Unicom, the country's No.2 telecoms operator, is currently the only carrier to officially carry the iPhone. It has not officially given its iPhone sales, but analysts estimate it has sold around 3 million iPhones since signing a contract with Apple in 2009.

China Telecom Corp Ltd, the third and smallest operator, is expected to be next to clinch a similar deal with Apple later this year, and analysts predict it would sell about 1.4 million iPhones this year if it can reach a deal with Apple by May, rising to 2-4 million new iPhone users in 2013.

($1 = 6.3016 Chinese yuan)

- Reuters

Tags: Apple, iPhone,
 0

You May Like These Videos

Comments

There are no comments.

Latest stories

Knox Mutizwa wins August Goal of the Month award

by kickoff | 05 November 2018 | 841 Views

BREAKING: Gandawa on the run

by Staff reporter | 05 November 2018 | 1621 Views

Econet cannot distribute Kwese TV content to Zimbabwean viewers

by Staff reporter | 05 November 2018 | 1233 Views

Shoot-out robbers arrested

by Staff reporter | 05 November 2018 | 1276 Views

Mnangagwa ally warns economic saboteurs

by Staff reporter | 05 November 2018 | 1233 Views

Chamisa mobilises supporters for mass protests

by Staff reporter | 05 November 2018 | 1017 Views

LISTEN: Acie Lumumba speaks on how he got paid

by Staff Reporter | 05 November 2018 | 842 Views

Dzamara speak on Zanu-PF fights

by Mandla Ndlovu | 05 November 2018 | 810 Views

Minister Raj Modi Modi donates salary

by Mandla Ndlovu | 05 November 2018 | 685 Views

'I am a Trillionaire' Magaya says

by Mandla Ndlovu | 05 November 2018 | 1085 Views

Supermarkets to be blacklisted over cooking oil

by Mandla Ndlovu | 05 November 2018 | 695 Views

UK army to recruit from Commonwealth

by BBC | 05 November 2018 | 743 Views

Magaya opens up on arrest

by Mandla Ndlovu | 05 November 2018 | 739 Views

Kambarami is still 'Deputy Mayor'

by Mandla Ndlovu | 05 November 2018 | 599 Views

'Import ban must not go beyond December 21'

by Staff reporter | 05 November 2018 | 690 Views

Prophet Magaya puts fresh spin to arrest

by Staff reporter | 05 November 2018 | 694 Views

Chamisa's sign language interpreters get thumps up

by Staff reporter | 05 November 2018 | 683 Views

Mnangagwa to review Mthuli Ncube's 2% tax again

by Staff reporter | 05 November 2018 | 655 Views

Lumumba to be probed by ZAAC?

by Staff reporter | 05 November 2018 | 485 Views

Dzamara speak on ZANU PF fights

by Mandla Ndlovu | 05 November 2018 | 447 Views

Zimbabwe as a new gateway into Africa

by Minister of Finance Prof Mthuli Ncube | 05 November 2018 | 663 Views

Chiwenga's ex-wife looted millions

by Mandla Ndlovu | 05 November 2018 | 1045 Views

We are our own worst enemies

by Mapozho Saruchera | 05 November 2018 | 719 Views

Mnangagwa to deal with unexplained wealth and bank deposits

by Staff reporter | 05 November 2018 | 675 Views

WATCH: Chiwenga talks about Prophet Walter Magaya's lipstick

by Staff reporter | 05 November 2018 | 664 Views

Lumumba Saga takes new twist....War vets bay for Mutsvangwa's blood

by Mandla Ndlovu | 05 November 2018 | 737 Views

Chamisa demands Presidency

by Mandla Ndlovu | 05 November 2018 | 627 Views

Zimbabwean teachers miss out on New Zealand opportunity

by Staff Writer | 05 November 2018 | 568 Views

Zimbabwe to introduce e-provisional driver's exams

by Staff reporter | 05 November 2018 | 614 Views

Zimbabwe to supply water to South Africa

by Staff reporter | 05 November 2018 | 611 Views

Mnangagwa claims that 'good times will soon roll'

by Staff reporter | 05 November 2018 | 581 Views

Zimbabwe as a new gateway into Africa

by Hon. Prof Mthuli Ncube | 05 November 2018 | 664 Views

Chiyangwa appoint Karikoga Kaseke

by Staff reporter | 05 November 2018 | 582 Views

ZCTU demo: Ruling today

by Staff reporter | 05 November 2018 | 533 Views

Missing cop found dead

by Staff reporter | 05 November 2018 | 660 Views

Tagwirei marries long-time girlfriend

by Staff reporter | 05 November 2018 | 1018 Views

Zimbabwe relaxes maternity leave entitlement

by Staff reporter | 05 November 2018 | 623 Views

Zimbabwe to receive drugs, ambulances from India

by Staff reporter | 05 November 2018 | 546 Views