China Unicom Purchases 5 Million iPhones to Go on Sale Next Month?

[MacRumors]

International Business Times covers reports from Chinese-language media claiming that wireless carrier China Unicom has purchased 5 million China-specific iPhones from Apple and will begin selling them next month.

China Unicom, the potential exclusive distributor of iPhones in China, has poured 10 billion yuan ($1.46 billion) to buy 5 million units from Apple, ready to sell the first batch in September, local media reported on Wednesday.

China Unicom had already paid Apple 10 billion yuan ($1.46 billion) for 5 million WCDMA standard iPhones with unit price of 2,000 yuan ($293), CBN news said, citing a well-informed source.

The report also notes that Apple has given up its traditional business model of sharing in "profit dividends" from its distributors, apparently referring to a lack of subsidies from the carrier that in other countries boost Apple's sales price for entry-level iPhone models by several hundred dollars.

Apple made compromises in the China market because of its great demand and intense competition, but Apple can still make profits from each unit from 1,000 yuan and 1,100 yuan as China Unicom offers a good price for each unit.

The iPhone will reportedly be offered to customers at about 2,400 yuan ($351) for the 8 GB model, with the 16 GB model possibly priced at 4,800 yuan ($702).

The news comes on the heels of a reported trip to China by Apple vice president of iPod and iPhone Product Marketing Greg Joswiak and other executives last week in order to finalize details with China Unicom.

Article Link: China Unicom Purchases 5 Million iPhones to Go on Sale Next Month?

 

[Mr. Gates]

Let them eat cake.

 

[Hattig]

Nice instant marketshare boost and income boost for Apple there.

 

[blueskyrocket]

Stock up $2.20 today already, the market has already priced it!

 

[mobi]

Stock up $2.20 today already, the market has already priced it!

Doesn't take them long does it?

 

[Grimace]

Stock up $2.20 today already, the market has already priced it!

Umm...no. Barclay's upped its target price - that's where the bump is coming from.

 

[edesignuk]

Holy s***. In China, they know how to place an order

 

[P-Worm]

Does anyone know how the iPhone has faired in Japan? I have my doubts that the iPhone will do that well in China.

P-Worm

 

[JGowan]

Generally, 4th quarter is everybody's best. Gotta love the holidays -- I know I do as my business is directly related to the shopping season.

Apple typically has a record breaking 4th quarter EVERY year. They stack the deck in their favor with new laptop updates and redesigns for their iPod lineup...

But this year, while I believe they'll have new laptops and ipods... they've got Snow Leopard coming out at a ridiculous price that NO ONE will pass up. And being that the talk is all of the POWER of MULTI-CORE with SL, I wouldn't doubt if we see something new in the iMac/Pro lines (I'm hoping Pro because I need a new system bad)...

and now 5M iPhones to sell to China -- wow -- we are going to see a quarter from Apple like no other.

 

[blueskyrocket]

Factory capacity?

How long would it take to make that many? Can they make 100,000 a day? It still would take 50 days just to build them, and thats not counting the rest of the world demand.

 

[tiiim]

How long would it take to make that many? Can they make 100,000 a day? It still would take 50 days just to build them, and thats not counting the rest of the world demand.

Well according to earlier rumors production had started a few weeks back.

 

[elhungarian]

So with Apple making WCDMA phones there is no doubt they are capable of making a CMDA phone, hopefully soon

 

[Burnsey]

Epic amounts of iphone and cash.

 

[MacTheSpoon]

Is there really going to be such a big market for iPhones at those prices?

 

[cleanup]

Is there really going to be such a big market for iPhones at those prices?

You'd be surprised how much Chinese yuppies (and tech-savvy teens) pay for their phones.

Service is relatively cheap, so they go all-out on the latest do-it-all phones from Japan, or, in this case, Apple.

 

[sjo]

You'd be surprised how much Chinese yuppies (and tech-savvy teens) pay for their phones.

Service is relatively cheap, so they go all-out on the latest do-it-all phones from Japan, or, in this case, Apple.

the problem is that iphone is neither do-it-all nor latest.

 

[azshopper]

Agree, I remember when pager was first introduced in China in the 80s. People would spend their WHOLE YEAR wages to get one. It was something like USD$200. It's pretty sad but it's still true...

You'd be surprised how much Chinese yuppies (and tech-savvy teens) pay for their phones.

Service is relatively cheap, so they go all-out on the latest do-it-all phones from Japan, or, in this case, Apple.

 

[cleanup]

Agree, I remember when pager was first introduced in China in the 80s. People would spend their WHOLE YEAR wages to get one. It was something like USD$200. It's pretty sad but it's still true...

Things have changed now. People spend a lot more, but it's a far smaller fraction of their yearly income. The divide between rich and poor in China is rather large. There's a lot of poor people, for sure, but there's a large middle-to-high-class demographic to go with it. These phones will sell in the cities: Shanghai, Beijing, Shenzhen, Guangzhou and Chongqing. The demand for technology and electronics in these places is ridiculous.

 

[azshopper]

That's true. Now the mid-high class spending is huge. Just consider one city, Shanghai with population of 24 millions, if 5% is mid to high class, that would be 800k consumers there. So I guess Unicom ordered 5 millions units make sense...

Things have changed now. People spend a lot more, but it's a far smaller fraction of their yearly income. The divide between rich and poor in China is rather large. There's a lot of poor people, for sure, but there's a large middle-to-high-class demographic to go with it. These phones will sell in the cities: Shanghai, Beijing, Shenzhen, Guangzhou and Chongqing. The demand for technology and electronics in these places is ridiculous.

 

[Teh Don Ditty]

So with Apple making WCDMA phones there is no doubt they are capable of making a CMDA phone, hopefully soon

No. Just no.

Verizon is going to LTE. There will not be a CDMA iPhone in America. Ever.

 

[mkrishnan]

So what is unique about the Chinese market iPhone models? Might it be that there's a 3GS with an 8GB capacity? Or is the new part number rumor related to packaging or something like that?

 

[Teh Don Ditty]

^There's no WiFi chip in there.

 

[mkrishnan]

^There's no WiFi chip in there.

Ahh, thanks. I missed the "no wifi" rumor and the associated apparent PRC law prohibiting phones sold there from having wifi and cellular services.... Verrry interesting.

 

[Teh Don Ditty]

Ahh, thanks. I missed the "no wifi" rumor and the associated apparent PRC law prohibiting phones sold there from having wifi and cellular services.... Verrry interesting.

Welcome. It's really about not letting people get outside of that firewall. But that's a for a different thread.

 

[iphones4evry1]

China Unicom had already paid Apple ... with unit price of 2,000 yuan ($293). The iPhone will reportedly be offered to customers at about 2,400 yuan ($351) for the 8 GB model, with the 16 GB model possibly priced at 4,800 yuan ($702).

So wait, Apple is only getting paid $293 per phone, and then China is turning around and marking the phones up to $351 and $702 ???? (doesn't Apple get about $550 per phone in the US? $199 or $299 from the consumer and then $300 from AT&T?)

This is great for Apple... but let's see if China Unicom can turn around and sell those 5 million iPhones.

.