Apple's iPhone Is Getting Crushed In China

Apple's strategy of aligning the iPhone with a single mobile carrier appears to have backfired in China, where Samsung has opened up a huge smartphone market-share lead.

According to Bloomberg, the iPhone has a 7.5% share of China's smartphone sales, while Samsung has a 24.3% share.

This share makes Apple the 5th largest smartphone seller in the country, while Samsung is No. 1.

Samsung has sold phones through all three major China mobile carriers since 2009: China Unicom (~200 million subscribers), China Telecom (129 million subscribers), and China Mobile (655 million subscribers).

Apple, meanwhile, has exclusively sold through China Unicom.

Apple launched sales through China Telecom last week, which should help boost its share. But China Telecom, though huge by western standards, is the smallest of the three carriers.

The granddaddy of China's mobile market, China Mobile, is expected to wait to sell the iPhone until Apple releases an LTE version, which China Mobile expects by the end of this year. An estimated 15 million "jail-broken" iPhones are already used on China Mobile's network, even without the carrier actually selling the phone.

The reason market share is important is that smartphones have become a platform market, in which developers build applications that run on top of various operating systems. As with Microsoft's Windows, if one platform achieves a dominant share, developers tend to gravitate to it, at the expense of other platforms. So one risk to Apple in China (and worldwide) is that Android might become the dominant mobile development platform.

Google's Android operating system, which powers Samsung's phones, is the global market-share leader with nearly 50% of the market, though Apple regained a lot of share last quarter on strong sales of the iPhone 4S.

Presumably, Apple's sales through China Telecom will help it close the gap with Samsung in China. But until Apple sells the phone through China Mobile, Samsung will likely remain China's dominant smartphone maker.

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Source: http://feedproxy.google.com/~r/clusterstock/~3/qgkriIG7vBI/apples-iphone-is-getting-crushed-in-china-2012-3

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