Edunology - Saumya Aggarwal

Last Apple results driven by China : Is it sustainable?

Last quarter Apple sold iPhones like banana in China, the figure touched 8 million. No doubt that it is the best smart phone available, still I think it is unsustainable going forward.

This exorbint sales helped Apple post record breaking profits in U.S. Analysts have praised the effort and seem too bullish for my liking. I have three main reasons why it seems tough:

A.) More than half of 30 million iPhones in China are unlocked and being used on unathorized China Mobile that limit the user experience to 2G only.

B.)  Apple is far from getting right product for China market. It is a pain to use iPhone for texting as Chinese input on iPhone is not user friendly. Multiple Chinese bloggers and community experts have expressed their concern. The only option is to jailbreak and install third party software to make iPhone work smoothly.

C.) The third seasons arises from first two. Since Chinese users have unlocked and jailbreak their phone, they can download App Store applications for free. Chinese apps are limited Siri does not work in China.

Apple iPhone comes with entire ecosystem. In China, it seems this ecosystem is broken. Local players provide much better solution to Chinese users at fraction of cost.