China Mobile Seeking Cut-Down Version of Apple's iPhone

China Mobile is expected to officially launch the Apple iPhone on its network shortly - but with some of the functionality removed to comply with Chinese regulations. The South China Morning Post, citing a report from the Daiwa Institute of Research said that the 3G and Wi-Fi services would be disabled on the Chinese model.Daiwa analyst Calvin Huang said that Taiwan Hon Hai Precision Industry, which is responsible for assembling iPhone products for Apple, is waiting for verification from the mainland to ship the phone without W-CDMA and Wi-Fi functions.
As China Mobile is widely expected to have to build outs its eventual 3G network using the Chinese developed TD-SCDMA format, disabling the 3G functionality would make it less appealing to users who might buy the handset and unlock it to be used on the expected W-CDMA network from China Telecom.
"Apple shouldn't customise a model of iPhone for the mainland market, given that it only provides a standardised product to operators around the world," Frederick Wong, a BNP Paribas analyst told the newspaper - although making the unit compatible with the Chinese language would be quite a customisation anyway.
China Mobile has been in on/off talks with Apple ever since the iPhone was launched. The talks broke down in January but resumed again in July.
"The talks with Apple to launch the iPhone device in China have resumed because Apple is not insisting on revenue-sharing anymore," China Mobile Ltd. spokeswoman Rainie Lei said at the time.
According to figures supplied by China Mobile to research firm In-Stat earlier this year, there were over 400,000 unlocked Apple iPhones being detected on its network.
In-Stat says that it has never doubted that the iPhone will achieve greater success than iPod in China if Apple teams with China Mobile to launch its Chinese version. There are two reasons. Firstly, different from the US where the smartphone market is fairly limited, appealing primarily to business users, The smartphone market in China, though, is an entertainment-oriented individual consumer market. The main reasons that Chinese mobile users purchase smartphones include entertainment (such as music players, cameras and video) and to access mobile Internet applications (such as IM, e-book, and games).
The company also estimates that 20% of handsets sold in China in 2007 cost more than 4,000 RMB (US$533). In another words, there are an estimated 28 million potential users for the iPhone in China.
On the web: South China Morning Post

China Mobile may offer Android handsets through cooperation with HTC, say Taiwan makers

2008/9/25
China Mobile Communications (China Mobile), the largest operator of mobile communication services in China, may take the initiative to offer Android handsets in the China market through outsourced production by Taiwan-based High Tech Computer (HTC), the maker of the T-Mobile G1, according to industry sources in Taiwan.

Demand for handsets in China expected to increase 15% in 2008

12 March 2008

Due to falling shipments of MediaTek handset chips in the fourth quarter of 2007, chip makers have been conservative about demand for handsets in the China market. However, industry sources recently noted that Nokia expects demand for handsets in the China market to increase about 15% this year, and that handset makers have not faced any inventory problems.

While heavy snowfall in late January did postpone handset demand partially, it also made consumers realize the importance of handsets, which should help contribute to increased shipments, China handset makers pointed out.

Demand for handsets in China totaled 250 million units in 2007, the sources indicated, making China's handset market the second largest in size after the US market.

IC design houses such as MediaTek, Elan Microelectronics, Richtek Technology, Global Media Technology, and Pixart Imaging would benefit from growing demand for handsets in the China market.

Meanwhile China's white-box handset makers are also determined to increase exports, and an increasing number of makers are already enjoying strong sales performance in Southeast Asia.

China Mobile Eyes Overseas Expansion Opportunities

21 Feb 2008
China Mobile, the world's largest operator by subscriber numbers has announced plans to seek overseas expansion and is considering setting up an MVNO in the saturated European market, along with industry favourite - the emerging markets of Asia and Africa.

Henry Ge, chief representative of China Mobile UK, told the Financial Times that the company would focus on three areas: emerging markets; overseas Chinese customers wanting to keep in touch with home; and "the short-term visiting market", which included travelling business customers and the growing number of Chinese tourists.

Vodafone has built up a 3.3 percent stake in China Mobile over a couple of purchases and has a representative on the company board of directors.

Last year, the China Mobile's unlisted parent company took control of Pakistan based Paktel for US$460 million and announced plans to spend a similar amount on improving the network.

On the web: Financial Times

China Mobile calls off iPhone deal

15 Jan 2008

Apple’s global sales target of selling ten million iPhone handsets by the end of 2008 was shattered as talks with the number one carrier, in the world's largest wireless market, has come to a halt.
Of China’s 522 million mobile phone subscribers, state-controlled China Mobile has 363 million subscribers and therefore a stronger upper hand in negotiating deals than other operators. "We can only say that negotiations have ended for now. We have no other news to report," said Li Honghui, a spokeswoman for China Mobile Communications Corporation."We have held talks with Apple to launch the iPhone device in China. However, those talks have ended," said Rainie Lei, a spokeswoman for China Mobile. Speculations point to disagreements over revenue-sharing terms in the preliminary discussions between the two companies.China Mobile, the world’s largest mobile phone operator based on the number of subscribers, was reportedly unwilling to accept Apple's request for a 20 per cent to 30 per cent share of China Mobile's user fees from future iPhone users.The Cupertino, California-based company, which released the hyped handset in the US, Germany, the UK, and France in 2007, has said it plans to launch the iPhone in Asia in June of this year. Apple, which so far has only released the device on the country's largest networks, has already begun talks with China Unicom to offer the iPhone exclusively in mainland China. Analysts believe smaller rival China Unicom is more willing to give Apple a larger piece of the revenue pie than China Mobile.

Elsewhere, Canadian company Research in Motion (RIM) is having an equally difficult time with China Mobile. RIM is known to have sent its first shipment of BlackBerry units to the mainland operator in October, with China Mobile vowing to kick off sales this year, but it has not yet began selling the devices.“You should ask China Mobile about the timeline,” RIM China general manager Charles Lui told Reuters. “From my perspective everything is according to plan.” The vendor also unveiled a Chinese distribution agreement with Alcatel-Lucent around the same time that has also failed to see the popular smartphone hit shops. Its regional launch is likely to come up against stiff competition from local players, including the similarly named RedBerry. Lui downplayed concerns and said RIM was “satisfied” with the staging of its Chinese launch and would initially focus on business customers. “China Mobile is basically targeting enterprises. Later on more services will be launched, but we need to start from somewhere,” he said. “It’s always fun to work in a competitive environment and BlackBerry has always welcomed competition.”

China Mobile in talks on iPhone

15 Nov, 2007

China Mobile CEO Wang Jianzhou has revealed the company is in talks with Apple to sell the iPhone but expressed reluctance to accept its partnership demands. “We still think we can maintain the operator-centric model because we have the customers,”he told attendees of the Mobile Asia Congress.
“We're discussing with Apple people but haven't any agreement. Our customers like this kind of fashionable product, and I think the big problem is with this model.” Apple expects to launch the handset in Asia next year following 2007 launches in the US and Europe. Wang indicated it is keen to continue its strategy of an exclusive operator partner with a strong revenue-share component.
It remains to be seen whether Apple will relent - China Mobile boasts nearly 350 million subscribers, which could translate into massive profitability just on handsets alone. Its stringent terms already saw Verizon decline an alliance in the US while the company agreed to launch the iPhone in France despite a law requiring it to sell unlocked handsets within the next few months. China Mobile is also unlikely to expend much effort in negotiations based on its subscriber trump card, tosay nothing of its membership in the recently formed Google Open Handset Alliance.
Meanwhile, the operator is on track to finish construction of its first eight metro TD-SCDMA networks this year. Wang said China Mobile will conduct a commercial trial once the builds are completed in anticipation of a 3G license award. The operator is widely expected to adopt the homegrown wireless standard following its inevitable spectrum win. "Once everything has been done, we will review the results accordingly," Wang told reporters.
China is expected to finally award 3G licenses following a restructuring of the nation's telecom industry. Wang declined to comment on possible changes, but said China Mobile was actively seeking to list A shares on a mainland bourse.