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Old 04-14-2012, 08:26 PM   #1
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At This Rate, Can Apple Ever Catch Google in China?

According to figures from Beijing-based Analysys International, Android significantly grew its market share throughout last year, starting with a 33.6% slice and closing out the fourth quarter with a 68.4% smartphone share within the country. Meanwhile, iOS has wavered and ended with just a 5.7% market share.

Low-cost offerings from a slew of hardware OEMs have helped Android gain traction, including handsets from Asian manufacturers such as Samsung (which enjoys nearly a quarter of the market, according to separate estimates from Gartner), HTC, and Huawei, among others.

While Apple offers a higher-quality device, it comes with a heftier price tag that hinders Cupertino's ability to address the medium- and low-end markets. The 1,000 yuan price point is considered particularly important, while the newest iPhone 4S starts at 4,988 yuan. Even the older iPhone 4 and 3GS models come in at 3,988 and 2,888 yuan, respectively.

The 1,000 yuan segment is specifically the market that NVIDIA (Nasdaq: NVDA ) is targeting with its previous-generation dual-core Tegra 2 found in Android devices. NVIDIA CEO Jen-Hsun Huang mentioned it on the last conference call as one of his company's main growth opportunities in the near term.

Microsoft (Nasdaq: MSFT ) saw its share shrink to 1.2%, but Mr. Softy still has high hopes of toppling both iOS and Android within China as the company works to "drive the price down." With these digits, that's an order that's getting taller to fill every quarter.

It's not as bad as Research In Motion's (Nasdaq: RIMM ) 0.1%. Besides, RIM has enough problems to worry about right now. While 60% of its revenue last year came from segments other than Canada, the U.S., and the U.K., such as emerging markets, obviously that's not from China.

One aspect that may be holding back Apple with the iPhone 4S is that it shares the same physical form factor as its predecessor. The iPhone is the ultimate status symbol in China, but Chinese consumers exhibit what's been called "superficial consumption," which also affects purchasing patterns for other luxury brands.

This behavior is locally referred to as "mianzi" (loosely translated as "face") and ties into one's reputation, honor, and respect, which underscores the relevance of the iPhone as a status symbol since it adds to one's mianzi.

Since the iPhone 4S looks identical to the iPhone 4, there's less social incentive to make the expensive upgrade since no one can tell the difference. Apple is widely expected to introduce a redesigned iPhone this year, which would undoubtedly boost sales accordingly.

Apple is seldom the top dog when it comes to market share, but it's usually the king of the profit share.

Apple is definitely an American company set to dominate the world, starting with China. If you need more, here are another three on the house. Emerging markets are a key component to any portfolio, so don't miss this special free report.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate and why could it make a few in-the-know investors some major profits over the coming months and years?

http://www.fool.com/investing/genera...-in-china.aspx
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Old 04-15-2012, 12:02 PM   #2
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There is no need for Apple to catch Google in China. They both can thrive and be successful there, side by side. Only the blogosphere wants to make this a steel cage death match.
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Old 04-15-2012, 04:19 PM   #3
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There is no need for Apple to catch Google in China. They both can thrive and be successful there, side by side. Only the blogosphere wants to make this a steel cage death match.
The blogs and Apple. Remember, it became Steve Jobs' mission to destroy Android no matter what, and many of his employees have that attitude, too. It became evident to the world when Apple started their lawsuit wars.
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Old 04-15-2012, 04:45 PM   #4
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Quote:
Originally Posted by BZap49

The blogs and Apple. Remember, it became Steve Jobs' mission to destroy Android no matter what, and many of his employees have that attitude, too. It became evident to the world when Apple started their lawsuit wars.
Too much is invested on both ends!
Either or isn't going away for a long time!
Apple could destroy Android but not open source!

It would come back as another name.

Just like Samsung has already released Tizen.
Another open source OS.

It's Prime Time in the SprintUsers Forum!
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Old 04-15-2012, 04:53 PM   #5
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What does that article have to do with Sprintusers general forum? And what is it with you and Apple? Almost every day you post some new article. A comment on that article summed up my opinion, so to save time I will paste it like you did. Just wait until China Mobile carries the iPhone and then we shall see.


"This article failed to mention distribution as a factor, instead focusing only on price. In the US, we have seen what a huge factor carrier support can be - iOS is nearly at parity with Android now that the iPhone is carried on 3 of the 4 major carriers. Older models at reduced pricing have also lifted iPhone to compete with less expensive Android devices. In China, Apple has bee tied to exactly one carrier until very recently.

The numbers in this analysis probably reflect a low point for Apple market share in China. At the end of Q411, the 4S was not yet for sale in the country. We saw a similar dip in the US one quarter earlier when the release of a new device was imminent. Also since the ending point in this analysis, Apple has inked China Telecom as a second carrier. Up until this March, China Unicom had the exclusive. The China Telecom deal adds 130 million new subscribers as potential customers, making this deal roughly equivalent to adding both Verizon and Sprint at the same time. Apple has yet to come to an agreement with China Mobile, but it's only a matter of time. The company's 600 million subscribers make it by far the largest carrier in the world, MORE THAN TWICE THE SIZE OF ENTIRE US MARKET. It is widely expected that Apple will do this deal in the next 12 months, catalyzing sales in the country in a major way.

Another unrelated factor that will give a major lift to Apple in China is the advent of smartphone subsidies. Historically, China has been the purview of Nokia and Samsung feature phones - more recently ZTE and Huawei have snatched much of this low-end share. This morning Nokia released a profit warning, saying that they are effectively being squeezed from both sides - Apple at the high end and inexpensive Android devices at the low end. The ZTEs of the world are able to make smartphones that are price competitive with Nokia feature phones, while carrier subsidies are goosing sales of high end devices like the iPhone. This portends good things for Apple, as the price paid is much less than the 4,888 yuan sticker number. In the US, consumers can get their hands on iPhone for $0 subsidized, but it's the 2.5 year old 3GS model. In China, customers can get a brand new 32GB 4S model for the same $0 price in exchange for a 3 year commitment. The contract requires a $45 plan, which is expensive for China but nowhere near the ARPU that US carriers demand to sell the iPhone. This deal is a reflection of the fact that Unicom no longer holds the exclusive distribution rights in China and will have to compete for users in the future.

In summary, Apple will likely have significant market share growth in China in the next quarter studied due to the new iPhone. It should be higher again in Q2 because of the China Telecom deal. It should be higher yet throughout the year because of aggressive carrier subsidies. And finally, it will see a major bump when China Mobile gets iPhone. Apple will never "catch" Google in market share, but Apple won't care as long as everyone who can afford an iPhone wants an iPhone. Chinese sales can easily grow at better than 100% for the next few years off a pretty big base, and Apple will scoop up 70% or more of the profits."
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Old 04-15-2012, 04:59 PM   #6
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Quote:
Originally Posted by gwmac View Post
And what is it with you and Apple? Almost every day you post some new article. .
Since you want to point me out...
And what about your other "Apple buddy" posting Android hatred everyday ?
What will you say about that ?

As much as Apple would like everyone to believe that everything they say is true.
It`s not !

There are 2 sides to every story!

Last edited by Euphorian; 04-15-2012 at 05:22 PM.
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Old 04-16-2012, 01:40 PM   #7
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Originally Posted by Euphorian View Post
Too much is invested on both ends!
Either or isn't going away for a long time!
Apple could destroy Android but not open source!

It would come back as another name.

Just like Samsung has already released Tizen.
Another open source OS.

It's Prime Time in the SprintUsers Forum!
I'm not even worried about open source going away. They'd have to get through Android first, and they're never going to be able to do that.
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Old 04-16-2012, 05:01 PM   #8
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Quote:
Originally Posted by Euphorian View Post
Since you want to point me out...
And what about your other "Apple buddy" posting Android hatred everyday ?
What will you say about that ?

As much as Apple would like everyone to believe that everything they say is true.
It`s not !

There are 2 sides to every story!
Too funny.

It seems every time I review any thread about Android or iOS on SU there is always without fail a "war front" on the subject.

The OS wars are unyielding and fierce on any given board and any given day.

Carry on as I throw my 2 cents in for today.
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