China Mobile iPhone Deal Could Make Apple Twice As Rich

China Mobile iPhone Deal Could Make Apple Twice As Rich

For some time, we’ve known that Apple lusts for the China market. Now comes word Tim Cook, Chief Operating Officer (and CEO stand-in) was seen at China Mobile’s home office. Signing China Mobile means $70 billion for the tech giant, potentially doubling the tech giant’s cash-on-hand.

With a population of more than 1 billion people, China represents “a whole new world” for the iPhone, according to analyst Brian White of Ticonderoga Securities. During the first half of 2011, Apple earned $5 billion from Greater China, or 10 percent of the company’s overall sales. That’s a sharp jump from a year ago, when Apple earned just $3 billion for all of 2010.

The iPhone sells to high-end subscribers, estimated by White at between 100 million and 125 million customers.

“The numbers speak for themselves,” White told investors Thursday. As for Cook’s visit to China Mobile headquarters? You don’t fly around the world to drop in and just say ‘hi’. “We are inclined to believe that an announcement is imminent over the next several months,” the analyst predicts.

There have been numerous reports of Apple prepping a lower-cost iPhone model. Earlier this year, two reports from Bloomberg and The Wall Street Journal suggested Apple was developing a handset half the size of the iPhone 4 and carrying a $200 no-contract price. Those reports indicated the device was aimed at competing with cheaper Android phones.

  • Brian

    I can understand the arguments for a cheaper iPhone, but Apple is a premium brand not a mass producer of generic devices, like HTC for example. Really don’t see this happening, especially with such growth from the existing 1 size fits all phone.

    Maybe when worldwide growth starts to taper out. 

  • prof_peabody

    I have to point out that nothing you say in your article illuminates, proves, or actually even *refers* to the hypothesis you make in the title.  Very sad. 

  • Rick Povich

    If Apple signs a deal with C.M. that’d be the one thing to finally get AAPL out of the computer-trader-controlled doldrums. That “Big Numbers” thingy everyone’s whining about…

  • B Stur

    True, I’ve noticed that the headlines of articles by Ed Sutherland aren’t based in reality and are seldom indicative of the few paragraphs that are written. He may be a veteran technology journalist and maybe he was a good one at some point. But not recently.

  • Rann Xeroxx

    When articles note the population of China in relation to possible sales it is always misleading. The vast majority in China cannot afford a iPhone or the data plans.  Plus just like pirating MS Windows and Office, the would just as likely use an iPhone clone… 

    http://saramobi.com/clone/ipho

About the author

Ed SutherlandEd Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.

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