The Journey of 1,000 Miles

“…in the December quarter…and these numbers [are] coming from a third party, 57% of the mobile browsing traffic in China was on an iOS device.  And so I…think you can see from this regardless of what you might hear about unit market share, our products are being used a lot more…”
– Tim Cook, CNBC interview, 1/15/2014

“…before China Mobile and Apple joined hands, I used a cell phone of another brand. Now I’ve decided to switch to an iPhone.  I’m very thankful to Tim Cook that this morning he gave me one of the first iPhones made for China Mobile.  And it’s gold, the most popular color amongst youngsters.” (via spoken translation)
– Xi Guohua, Chairman, China Mobile, the same CNBC interview

The first segment of Apple and China Mobile’s journey is paved with the predictable Apple platitudes (“making the best, not the most”, “usage matters more than market share”, etc.) and “deep respect” for China Mobile; the also-predictable reciprocated sentiment and “personal product endorsement” from China Mobile’s chairman; and the just-as-predictable endless skepticism about Apple’s ability to improve its position in the absolute market battlefield that Apple calls the Greater China geography.  Oh, and then there’s the whole “iPhone is too expensive for China, even with that not terribly impressive subsidy from China Unicom/Telecom/Mobile”.

Safe to say that Apple’s strategy in China will continuously evolve if and as needed. Tim Cook and his team clearly know how fiercely competitive and far-from-guaranteed the Greater China market is,¹ and that it will require immense quantities of time, attention, resources and perseverance. It could be several quarters (maybe even a few years) until Apple’s success or lack thereof can be better assessed. It’s going to be a long game, just like everything else Apple does. But that first, single step of the China Mobile/Apple partnership has finally been taken.

It’ll be fascinating to see where things go from here.


Bonus quotation (Xi Guohua, via spoken translation, CNBC interview): “You asked a very important question to Tim Cook on [iPhone unit sales] numbers. I cannot tell you completely of course but since December 23rd, when people didn’t know pricing, we had millions of preorders. This is very encouraging.”


1 Fiscal Q2-Q4 2012 to Q2-Q4 2013 Greater China YOY revenue growth (less than 1%) tells a story that Apple – or any company in that position paying attention – obviously can’t (and won’t) ignore.

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