iPhone sales are off to a slow start in China where Apple is facing three key obstacles:
1 – Pre-existing Unlocked iPhone Market – Many potential customers have already bought iPhones from unauthorized sellers, putting an estimated two million iPhones already in use in China.
3 – Feature Limitations & Poor Service – Wi-Fi Internet service has been disabled on Unicom’s iPhones to comply with Chinese government rules. In addition, China Unicom last week released a survey of its signal quality, which showed that only 30 cities now meet the company’s ideal standards and nearly 28 cities have average or poor quality.
We believe that Apple will be able to sell 2.8 million iPhones in China in 2010 representing nearly 7% of the 48 million global iPhone sales that we forecast for that year. Over the Trefis forecast period, we expect iPhone market share to increase from 3.5% (48 million iPhones) to 13% (213 million) which includes growing contributions fromt the Chinese market. Within Apple’s content on our platform, you can see how lower iPhone Market Share due to poor penetration of the Chinese market would impact Apple’s stock.
What do you think?
