Apple Inc. is getting closer to offering the iPhone through China’s largest mobile carrier, state-owned China Mobile Ltd., giving the company access to hundreds of millions of new customers.
The effort is Apple’s latest move in the risky Chinese market, which could play a central role in the company’s growth plans.
Apple has begun targeting China’s growing consumer class, opening its first retail stores and marketing its products, from Mac computers and iPad tablets to its iPhone.
Apple’s role in China will expand greatly if China Mobile begins offering the iPhone. The iPhone has been available in China through the country’s second-largest carrier, China Unicom (Hong Kong) Ltd., since 2009. But China Mobile, which is the world’s largest carrier, has 600 million subscriber accounts, compared with fewer than 200 million at China Unicom.
Based in Cupertino, Calif., Apple has historically focused on its home U.S. market, with the Americas region generating 38% of the company’s $24.7 billion of revenue in the March quarter. But Apple is again expected to post strong China sales Tuesday when it reports earnings for its June quarter. Indeed, China is already Apple’s fastest-growing region in terms of sales, despite the fact that the company has opened only four Apple Stores in the region.
China has become one of the world’s most important consumer markets because of its sheer size and fast-growing economy, which surpassed Japan this year to become second in the world.
Despite its popularity, Apple still has a tiny portion of the Chinese computer market. It is fourth in the smartphone market, with about an 8% share, partly due to its October 2009 entry into the Chinese market.
Overall, China represents a big—and relatively untapped—opportunity for Apple. The iPhone is likely to be offered through China Mobile in the next 12 months, analysts said. The company faces growing competition from smartphones running on Google Inc.’s Android software.