Apple's iPhone hits China with high price, without Wi-Fi

[AppleInsider]

The iPhone saw its formal debut in China Friday on carrier China Unicom, with the Wi-Fi-less hardware sold via 2,000 stores at a starting price of 4,999 yuan, or $730.

That high price was cited by The Wall Street Journal as the "buzz-killer" over the handset's debut. The high-end iPhone 3GS sells for 6,999 yuan ($1,024) without a service contract, which is how most people in China purchase their phones. The same handset can be bought for about $800 in Hong Kong.

"When wrapped together with a service plan, as is generally done in the U.S., the phone will cost Chinese subscribers at least $3,120 over two years, compared with the roughly $2,600 cost for the same period for customers in the U.S.," the report said.

The average cost of a smartphone in China is $350. And Apple must also compete with an estimated 2 million imported iPhones that were already in China as of the summer of 2009.

The cheapest iPhone runs 4,999 yuan, or $630, according to The Associated Press. And all of the officially sanctioned models come without Wi-Fi. But an imported iPhone 3GS with Wi-Fi can be bought from Chinese street markets for 5,700 yuan, or $835.

China Unicom said it hopes to have Wi-Fi in the next batch of iPhones it intends to release by the end of the year. The feature was left out of the hardware because the government's regulations temporarily banned the system in favor of a rival Chinese offering. That ban, however, was relaxed in May, after manufacturing of the new iPhone model began.

The iPhone's debut in China has been delayed not only by Chinese government regulations, but also talks with the nation's carriers. The country of over 1 billion is the largest cell phone market in the world, and one that Apple has been eager to take a crack at, despite a number of setbacks.

The agreement between Apple and China Unicom was made official in August. The non-exclusive agreement has left the door open for Apple to turn to competitor China Mobile, the world's largest wireless operator. Apple has been in negotiations with China Mobile for some time. China Mobile has 508 million wireless subscribers, while China Unicom has 143 million mobile accounts.

[ View this article at AppleInsider.com ]

[sheff]

Does anyone know why no wifi?

Also I think that Chinese knockoffs are good enough for most in China, and the crazy price is insane, considering the phones are made there (at least I know the touches are)

[Roc Ingersol]

Because America doesn't have a monopoly on anti-consumer service provider demands.

[tonton]

Originally Posted by sheff

Does anyone know why no wifi?

Did you read the article?

"The feature was left out of the hardware because the government's regulations temporarily banned the system in favor of a rival Chinese offering known as BDA."

[anantksundaram]

Fail.

[Dlux]

China Unicom said it hopes to have Wi-Fi in the next batch of iPhones it intends to release by the end of the year.

So the first batch is generally acknowledged to be a counter-productive waste of effort?

[John.B]

The finance.yahoo.com link is a 404.

I'm shocked that Apple did any iPhone hardware modifications just to get into China.

And I'm more shocked that the Chinese dictators didn't demand the camera get removed as well:

[John.B]

Originally Posted by tonton

Did you read the article?

"The feature was left out of the hardware because the government's regulations temporarily banned the system in favor of a rival Chinese offering known as BDA."

BDA is actually BDA China Ltd., a Beijing-based technology research firm. From the AP article:

Originally Posted by From the original AP story

Unicom's iPhones lack WiFi because it was temporarily banned by Beijing, which was promoting a rival Chinese system, according to BDA. The ban was relaxed in May after manufacturing had begun.

Did you read the article? AI didn't! But Mac Rumors did.

[Wiggin]

Originally Posted by John.B

BDA is actually BDA China Ltd., a Beijing-based technology research firm. From the AP article:



Did you read the article? AI didn't! But Mac Rumors did.

So basically, the government banned wi-fi to cripple the iPhone and give a leg up to BDA? Talk about home field advantage!

[John.B]

Originally Posted by Wiggin

So basically, the government banned wi-fi to cripple the iPhone and give a leg up to BDA? Talk about home field advantage!

No, BDA is like the Chinese version of Gartner. They do technical analysis for publications too lazy to do their own research and need to have their "facts" spoonfed to them.

The Chinese government banned WiFi for a competing standard that, IMO, probably is easier for them to monitor and block should another Tiananmen event ever break out...

[cendrillon]

Officially the government banned wifi to 'stimulate the economy', the idea being that without wifi people would spend more on mobile data.

Often the government also have ownership of certain companies with technology in a particular area. So if there is an alternative Chinese 'home grown' (see home copied) version of wifi, and if the government have a stake in the companies that developed this technology, then they'll ban wifi to make their own companies perform better.

A similar thing occured with 3G LTE, with the government instead pushing TD-SCDMA. Everyone knows that this is pretty much a failure, so now they're pushing 3G LTE TDD, which is a bizarre version of 3G LTE that will be incompatible with the version used in every other country. All other countries sensibly use 3G LTE FDD (frequency division duplexing) instead of the weird TDD version being pushed in China.

Oh well....

[dshel]

Here is a more accurate read on CHU IPhone pricing! The Apple Bashers are really hard at work!
************************************************** **********************

¶ BEIJING (Dow Jones)--China Unicom (Hong Kong) Ltd. (CHU) said Tuesday that Chinese customers who select the most expensive service plans under a two-year contract can receive the Apple Inc. (AAPL) iPhone for free.

¶ Customers who sign up for the priciest monthly plan, at CNY886 per month ($130) for two years, will get the top-end 32-gigabyte iPhone 3Gs for free, as opposed to the retail price of around CNY5,000, ($732) the company said.

¶ However, under that plan, customers must be willing to pre-pay their monthly bills by putting down a hefty deposit of CNY7,999 ($1,170).

¶ By contrast, the equivalent phone in the U.S. sells for $299, with a two-year service plan that ranges from around $45 to $120 a month, including text messaging.

¶ Thus the total cost of ownership over a two-year period for a top-end iPhone will be similar in China and the U.S. The priciest plan in the U.S. offers unlimited calls and texting, while the top-end plan from China Unicom still limits calls and messages, albeit at a generous 3,000 minutes per month for calls.

¶ -By Aaron Back, Dow Jones Newswires; (8610) 6588-5848; aaron.back@dowjones.com

[solipsism]

1) No one outside the China has the right to bitch about their phone price and service plan now.

2) The WiFI thing is well known and I’m glad it’ll be dropped soon. I’m surprised that Apple didn’t wait to release these phones until it was dropped. Unless….

3) Unless they didn’t remove the WiFi chip (which also contains the Bluetooth 2.1 + EDR + FM). That seems costly to do when the chip itself it cheap. If they were allowed I’d reckon they’d just not include the driver or UI elements for the WiFI, but can add them later in an update after this silly WiFI ban for cellphones is over.

4) Apple surely knows the market better than I do, but I have to wonder about the pricing. If a more functional device can be had for less money on the grey market why not go with that? I wonder if the high price of the device will build in an elitist market, making it even more of a status symbol. Will we see a price drop after a few months?

[addabox]

How does China plan to become a global superpower if they're going to adopt oddball, "homegrown" versions of international standards?

My impression is that China remains fairly insular and arrogant, regarding the ascendancy of the west as an unfortunate anomaly, but I would think simple pragmatism would steer them clear of doing something as loopy as trying to drive an alternative to WiFi.

At some point, the enormous conflicting forces at play in China today are going to explode.

[samab]

Originally Posted by solipsism

4) Apple surely knows the market better than I do, but I have to wonder about the pricing. If a more functional device can be had for less money on the grey market why not go with that? I wonder if the high price of the device will build in an elitist market, making it even more of a status symbol. Will we see a price drop after a few months?

I think a lot of that price jump is taxes. In countries like China and India, official white goods products are much more expensive than gray market imports --- because import duties are very high.

Even though the iphone is manufactured in China, they are manufactured in "special economic zones" that have aimed at making products to export overseas --- and I bet that these chinese-made iphones are still subject to high import duties when they "re-enter" China.

[aaarrrgggh]

I still think Apple has a good thing going in China, assuming earlier rumors of a $450 ASP are not true. Selling a million units there thus quarter should be easy, and 2-3mm within the range of possibility.

The idea that wifi functionality is just firmware disabled is interesting, but if it were the US, I would think they would need regulatory approval numbers to match approved features. Who knows; maybe they will leak a hack to enable wifi...

[samab]

Originally Posted by addabox

How does China plan to become a global superpower if they're going to adopt oddball, "homegrown" versions of international standards?

My impression is that China remains fairly insular and arrogant, regarding the ascendancy of the west as an unfortunate anomaly, but I would think simple pragmatism would steer them clear of doing something as loopy as trying to drive an alternative to WiFi.

At some point, the enormous conflicting forces at play in China today are going to explode.

There are plenty of people on this forum who advocates that the US government should force all the carriers to have a single standard.

The fact is that these kinds of government intervention doesn't work. South Korean government is still pushing their carriers to deploy the South Korean version of wimax (called wibro) instead of LTE.

http://www.telegeography.com/cu/arti...399&email=html

Japan had a Japan-only 2G mobile telephone system.

[cnocbui]

Apple: We want to sell the iPhone in China.

Government Official: Take the WiFi out first.

Apple: No, that would be against the interests of the users experience, we could instead cease having any Apple devices manufactured in China permanently and have them all made in Taiwan instead, if you like.

Government Official: When would you like to start shipping?

[samab]

Originally Posted by cnocbui

Apple: We want to sell the iPhone in China.

Government Official: Take the WiFi out first.

Apple: No, that would be against the interests of the users experience, we could instead cease having any Apple devices manufactured in China permanently and have them all made in Taiwan instead, if you like.

Government Official: When would you like to start shipping?

Except chinese wages are 100 times cheaper than in taiwan. And the factories that are manufacturing the iphones are Taiwanese-owned companies.

[solipsism]

Originally Posted by addabox

At some point, the enormous conflicting forces at play in China today are going to explode.

Yes, but not probably not until well after they have the world’s largest GDP. Wait until an internal breakdown ricochets though the world’s economy then. It will make the last recession seem like nothing. (speculation)

Originally Posted by samab

I think a lot of that price jump is taxes. In countries like China and India, official white goods products are much more expensive than gray market imports --- because import duties are very high.

Good point. I wonder if we’ll see the grey market sellers raise their prices or if they have to much competition within themselves to be able to.

Originally Posted by aaarrrgggh

IThe idea that wifi functionality is just firmware disabled is interesting, […] Who knows; maybe they will leak a hack to enable wifi...

From iFixit…

• image: http://s1.guide-images.ifixit.com/ig...I2UNWjYJ.large (circuit board)
• image: http://s1.guide-images.ifixit.com/ig...moybnfat.large (circuit diagram)

[Chesire]

I'm surprised that we are surprised by any of this.

I love apple products and have for years. They maintain a real 'counter culture, cool, rebel' image merely because of their major competitor, but at the end of the day they will make the deal to increase the stock price.

They bowed to the Chinese government to get their product in play and in doing so, sacrificed user experience and integrity. So be it.

I am more disturbed by the bad pricing decision. From a market dominance standpoint I'd imagine they would have wanted to try and push the grey market products out, not give them a leg up. Maybe there is a strategy at work here I don't understand.

Any economists on the blog?

[anakin1992]

Originally Posted by John.B

No, BDA is like the Chinese version of Gartner. They do technical analysis for publications too lazy to do their own research and need to have their "facts" spoonfed to them.

The Chinese government banned WiFi for a competing standard that, IMO, probably is easier for them to monitor and block should another Tiananmen event ever break out...

ok, first non political side:

they are different things:

1: chinese government bans wifi on iphone
2: chinese government bans wifi on cell phone
3: chinese government bans wifi regardless on what device
4: chinese government bans wifi which is not using chinese wifi standard on cell phone devices

to my knowledge, wifi is not banned at all in china. newer laptop/some of desktop computers are all default with wifi. in the final rectification meeting of wifi security meeting, chinese proposed a better solution, but it was rejected by the committee. so chinese decided to enforce their version of proposal domestically. i am not sure why only cell phone wifi is targeted in iphone case.

second, political side:

it would be really stupid that chinese government bans network access. just take a look at 2 brutal killing rampages in tibet and xingjiang. government stupidly sealed off the official news on the events, but ppl provided the first count video footage to youtube. otherwise, the world would not believe those tibetans and urghars brutally killing innocent people in bright day light. so it is youtube and flickr who saved the chinese government thousands of words to explain what is going on. the effect is just unbelievable.

third, network politics is very popular in china. one of scary thing on chinese web is the one called "human search". it is a process to identify a person, who committed a bad act, such as spit on street or bad official, etc. once this individual's act generated the mass anger on the web, ppl on the web will automatically create a zeal to find out who this individual is and where s/he lives etc. within a matter of couple of days, this individual will be a national famous household personal. the whole process is from web, on the web, and done by web. no one even knows who really finds out or feeds in the info about this individual. it is much much powerful than any secret agency.

[anakin1992]

Originally Posted by Chesire

I'm surprised that we are surprised by any of this.

I love apple products and have for years. They maintain a real 'counter culture, cool, rebel' image merely because of their major competitor, but at the end of the day they will make the deal to increase the stock price.

They bowed to the Chinese government to get their product in play and in doing so, sacrificed user experience and integrity. So be it.

I am more disturbed by the bad pricing decision. From a market dominance standpoint I'd imagine they would have wanted to try and push the grey market products out, not give them a leg up. Maybe there is a strategy at work here I don't understand.

Any economists on the blog?

you don't need an economist to comment on this.

yes, any chinese can spend much much less to purchase an iphone from grey market. but the condition is that you have to understand how to configure it by yourself. basically it is boiled down to customer support. i used to purchase some electronic gadgets for friends in china as gifts. they all love those devices, but unfortunately most of them don't know english and how to read the manual.

in eastern asia, not just chinese, cell phone is not just a phone... it is something more than it to show a person's taste/status. for those who can not afford it, they would go to faked iphone or from grey market or cheaper cellphone. for those who understand english and technology, they would go to US or HongKong to get one. but still there are lots of left who can afford this one at $1000 price range. replacing an old cell phone of $800 to a new one at $1000 is not uncommon things among chinese.

[anakin1992]

Originally Posted by samab

Except chinese wages are 100 times cheaper than in taiwan. And the factories that are manufacturing the iphones are Taiwanese-owned companies.

well, as a whole, it is true that mainland chinese wage is very low, about $2-3000 per capita. but taiwan only has about 23 millions of people, people in beijing/shanghai or some other big cities of similar population of 20 millions would earn no less than ppl in taiwan, specially if you take into account of government assistant housing program.

[anakin1992]

Originally Posted by solipsism

4) Apple surely knows the market better than I do, but I have to wonder about the pricing. If a more functional device can be had for less money on the grey market why not go with that? I wonder if the high price of the device will build in an elitist market, making it even more of a status symbol. Will we see a price drop after a few months?

i don't think apple controls the final price. my information is that apple sold a batch of iphones to chinese carrier at a given price which of course is much much lower. chinese carrier is adding more to recover its investment and they are smart too. if the high price is stalling iphone adoption rate, they would come up a new sale pitch. this is new model to them too, so it would take time for them to sort it out and move further.

when iphone first came into US market, who would have thought its model would make such a big hit?

[addabox]

Originally Posted by Chesire

I'm surprised that we are surprised by any of this.

I love apple products and have for years. They maintain a real 'counter culture, cool, rebel' image merely because of their major competitor, but at the end of the day they will make the deal to increase the stock price.

OT, but this gets repeated all the time as if it were self evidently true, but I don't think it is (although it may have been at one time).

Look at the marketing for the iPhone. Does is seem predicated on maintaining "coolness", or anything remotely resembling "counter culture"? Or does it seem to want to be as friendly and accessible as possible, for as many people as possible?

If anything, it's Microsoft that goes way out of its way to try and muster some "hipster cred" for its consumer goods.

[emulator]

thx for this great bolshie news.

[isaidso]

Interestingly; this morning while searching for news on the China iPhone intro., I found this story.
(It's translated through Google Translate so...)

Technology News October 30 News, China Unicom Chairman Chang Xiaobing, the first iPhone sold at today's ceremony, science and technology, said on Netease, China Unicom will soon provide users with the perfect cell phones and better 3G network services.
For the next iPhone will feature built-in WiFi, Chang Xiaobing, said that China Unicom will be completed as soon as possible.
It is reported that China Unicom today, according to the previously published "24-month contract plan" as well as the bare-metal tariff tariff for sale in two ways.

October 14, China Unicom officially announced the iPhone price of bare-metal programs. Bare-metal prices to cover all three versions of the introduction of China Unicom's iPhone, which, iPhone 3G 8GB price is 4,999 yuan, iPhone 3GS 16GB price is 5880 yuan, iPhone 3GS 32GB price is 6999 yuan.
It is learned that participate in the "24-month contract plan" Unicom iPhone mobile phone users, be stored in different amount of the net-cost voice and at least two years, the network when the one-time fees are paid, respectively iPhone 3G 5999 Yuan, iPhone 3GS 16GB 6999 yuan and iPhone 3GS 32GB 7999 Yuan. (Hao)
(This article Source: Netease technology coverage)

[NasserAE]

Originally Posted by solipsism

1)
3) Unless they didn’t remove the WiFi chip (which also contains the Bluetooth 2.1 + EDR + FM). That seems costly to do when the chip itself it cheap. If they were allowed I’d reckon they’d just not include the driver or UI elements for the WiFI, but can add them later in an update after this silly WiFI ban for cellphones is over.

I know in Egypt Apple needed to disable the GPS because of government law that prohibit the use of GPS systems. Apple disabled GPS by software and many were able to reactivate it by jailbreaking. Some countries have some stupid laws.

[Eriamjh]

http://brainstormtech.blogs.fortune....up-for-iphone/

It seems popular.

[solipsism]

Originally Posted by Eriamjh

http://brainstormtech.blogs.fortune....up-for-iphone/

It seems popular.

I’ll say. Just check out the crowds in front of the store and how long the line is.






Happy Halloween!

[Xiaohuzi]

i love how you jerks speculate about this and that over China...you're dip-sh*tz. yeah, there is some stupid restrictions regarding internet use (amongst other things) and i speak from experience, i am a proud son-in-law of China and i live there part of the year. but you know something? China doesn't contain the ratio of degenerates to "normal" citizens as the USA does (pretty funny considering China runs rings around us population wise). believe it or not, China has a reason for what they do...research it...a primary reason for its tight control on entertainment and information is to protect the general populace from becoming a bunch of immoral, disrespectful, and intellectually retarded group of people as the USA is evermore rapidly devolving into. it's funny how folks whine about China yet they fail to realize (due to their ignorance of China) that unlike the USA, you don't have to worry about child abduction, rape, drive-bys, gang fagg*ts...you know, what we've come to love about our free country! so keep on posting your played out derogatory statements about China, but why don't you follow the tenets of your beloved leader BHO (and HIS comrades) and post information of all the failures of our public education system, murder rates in urban areas...and so forth...you know, in keeping pace with the fairness doctrine. and i am sure to be expecting the usual know-it-all sassy statements and nerdy numbers in response to this...just remember, your beloved leader, the messiah, will save us, right?

and NO, i am NOT a PC

[SGSStateStudent]

Originally Posted by emulator

thx for this great bolshie news.

BS alert!

[tonton]

Oh, give me a break. I'm far safer walking through South Central Los Angeles than I am in certain parts of Shenzhen. No child abductions? Girls all over China are stolen or sold for prostitution all around the world. No gangs? Triad business in big cities in China is nearly as bad as the Yakuza in Japan. Try walking through parts of Shenzhen without getting your arm pulled by prostitutes. Notice those beggars without hands or feet? Their hands and feet were CUT OFF by the beggar masters so that they could earn more money. And criticizing BHO for being a bad or corrupt politician!? Compared to Chinese politicians!?

You are definitely trolling here and I don't believe you stand behind a word you've said.

Yes, the US is degenerate. I left the US because I think Americans are arrogant, rude and selfish and reality TV is an embarrassment to American culture. But to sacrifice freedom for censorship by choice!? Maybe you're better off in North Korea than China, with that attitude.

Originally Posted by Xiaohuzi

i love how you jerks speculate about this and that over China...you're dip-sh*tz. yeah, there is some stupid restrictions regarding internet use (amongst other things) and i speak from experience, i am a proud son-in-law of China and i live there part of the year. but you know something? China doesn't contain the ratio of degenerates to "normal" citizens as the USA does (pretty funny considering China runs rings around us population wise). believe it or not, China has a reason for what they do...research it...a primary reason for its tight control on entertainment and information is to protect the general populace from becoming a bunch of immoral, disrespectful, and intellectually retarded group of people as the USA is evermore rapidly devolving into. it's funny how folks whine about China yet they fail to realize (due to their ignorance of China) that unlike the USA, you don't have to worry about child abduction, rape, drive-bys, gang fagg*ts...you know, what we've come to love about our free country! so keep on posting your played out derogatory statements about China, but why don't you follow the tenets of your beloved leader BHO (and HIS comrades) and post information of all the failures of our public education system, murder rates in urban areas...and so forth...you know, in keeping pace with the fairness doctrine. and i am sure to be expecting the usual know-it-all sassy statements and nerdy numbers in response to this...just remember, your beloved leader, the messiah, will save us, right?

and NO, i am NOT a PC

[ElliotGraham94]

why would they need wifi anyways, the mobile internet wil be rapid there

[John.B]

Originally Posted by Xiaohuzi

i love how you jerks speculate about this and that over China...you're dip-sh*tz. yeah, there is some stupid restrictions regarding internet use (amongst other things) and i speak from experience, i am a proud son-in-law of China and i live there part of the year.

Well isn't this just precious!?!

You don't hold your countrymen in very high regard that they have to be protected against immorality, do you? If your country was as pure as you seem to think, wouldn't they be too upstanding to be corrupted? Or do we just not hear about it in your repressed society? There was a coach at the Beijing Olympics whose parents were randomly stabbed at a nearby tourist site, it got a lot of press over here. It probably happens on a daily basis, but your "beloved party" doesn't allow word to get out. That's the difference. If you don't have rapes being reported, then you don't have rapists being prosecuted, which means you probably have a lot more rapes than the worldwide average -- because it's hushed up.

Here's the acid test though, could you publicly hold the opposite opinion in Beijing? I didn't think so. Democracy has it's faults, but when we get tired of one set of leaders, at least we have the opportunity to throw them out. How does that work in RC again? Here's a link to a recent NYTimes to some of the more ludicrous laws your beloved leaders enact on their citizens. I bet most people in RC wish they could choose their own leaders with s**t like this on the books all across your country.

Be sure to enjoy your totalitarian government when you go back home, where the government tells you what to think and what you can say and what you can do and who you can be. We notice that you claim to leave RC on a regular basis, why is that, comrade? Not so happy there after all?

Originally Posted by Xiaohuzi

and NO, i am NOT a PC

You aren't a PC or a Mac... You're just a troll who found AI through an internet search (that your government cheerfully blocks you from doing when you are home!)...

Besides, aren't you supposed to be using the government approved Red Flag Linux, comrade?

[Xiaohuzi]

tonton: hey, i resemble that remark!

John.B: Mister, what DOES suck about China is not being able to show my friends the Village People's "Sex Over the Phone" video on YouTube...that makes me angry!

[cycomiko]

they should just buy the aPhone, or MiPhone, or maybe even the iPhone Mini (with two sim slots)

They are cheap

[NOFEER]

the competition to the 3g 3gs is the 2g from ebay which works and has wifi
chinese want internet access just like we do

[addabox]

Originally Posted by solipsism

I’ll say. Just check out the crowds in front of the store and how long the line is.






Happy Halloween!