China Mobile wants iPhones, OPhones
By Michael W. Jones
Despite a signed deal between Apple and China Unicom, plus what appears to be a deal between China Mobile and Lenovo for the O1 Android phone, China Mobile still appears to want the iPhone.
Although smartphone service provider exclusivity is an issue in some areas, such as the case with the iPhone and AT&T in the United States, that would not appear to be meaningful with wireless providers in China. Apple signed a deal a couple of weeks ago with China Unicom to sell the iPhone in China, a deal which is clearly not exclusive, since the largest wireless provider in China (Chine Mobile) is still in negotiations with Apple to also handle the iPhone in what may be the largest cell phone market in the world.
At the same time, China Mobile is said to be close to a deal with Lenovo to sell that company’s new O1 smartphone, which is powered by Google’s Android operating system. While rumors have been rife that Chinese carriers believe that smartphone penetration of their marketplace would be best with a phone that sells for around US$150, neither the iPhone or the Ophone qualify to be in that range. Certainly, the new models of the iPhone will not sell for that low a price, and now PCWorld is out with a story that the OPhone that Lenovo has targeted for China may have a price tag five times the desired price point, although an extended service contract may lower that price.
A report on local Chinese portal Tencent has reported that the Lenovo Mobile phone will cost around 5,000 yuan (about US$700), but that users will be able to buy it for 1,500 yuan (US$220) if they also subscribe to China Mobile’s 3G service for an extended term. The first handset to launch with the China Mobile OS, a 2G version of the Magic handset from High Tech Computer (HTC), also sells for a much higher price, around 5,000 yuan.
Competition for the huge Chinese marketplace is truly heating up, with all sectors of the market being hotly contested, from standard cell phones to smartphones. If the US$1.5 billion iPhone deal with Chinese Unicom is any indication, Apple stands to increase its smartphone business markedly with the new Chinese deal, though there will be plenty of competition from many manufacturers. It will be interesting to see if an Android phone can get more traction in China than it has in the U.S. and whether Apple can maneuver the iPhone into a leadership position in China by signing deals with multiple vendors.
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