China Mobile denies iPhone deal, insists talks ongoing

Posted:
in iPhone edited January 2014
China Mobile denies inking a deal with Apple, throwing cold water on reports claiming the two companies finally reached a partnership agreement that would see the iPhone offered to carrier's 740 million subscribers.

Suzhou


Word of the deal first emerged in the Wall Street Journal late Wednesday, but a followup report from CNNMoney just hours later refuted the "insider information" with a statement from a China Mobile saying nothing had been signed, but instead that negotiations were "in progress."

Reuters later corroborated the development, with a statement from China Mobile spokeswoman Rainie Lei saying that the carrier is "still negotiating with Apple, but for now we [China Mobile] have nothing new to announce."

Despite the uncertainty surrounding its consummation, it is widely believed that a deal between the two companies is imminent. Previous reports have indicated that the iPhone's appearance on China Mobile's network was being held back until the introduction of the carrier's 4G TD-LTE network, an event that should take place in mid-December now that China's telecommunications regulator has signed off on the launch.
Despite the false start, a China Mobile deal is believed to be imminent.
Additional evidence pointing to a December introduction has accumulated in recent weeks. China's state-run Xinhua News Agency reported in late November that both China Mobile's 4G network activation and the iPhone launch would take place on Dec. 18.

Further, on Monday, a China Mobile subsidiary in the mainland city of Suzhou, near Shanghai, rolled out a web-based reservations system for Apple's handset, though the page was withdrawn.

Analysts believe that an agreement with China Mobile could be a major new revenue driver for Apple. Amit Daryanani of RBC Capital Markets and Gene Munster of Piper Jaffray both predict that the arrangement could result in an additional $10 billion in revenue on sales of 17 million iPhones in calendar 2014.
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Comments

  • Reply 1 of 56
    jakebjakeb Posts: 557member
    Wow. One thing that's become clear through this whole story. Doing deals with China Mobile must be a complete nightmare. Good on Apple for focusing on the long game.
  • Reply 2 of 56
    philboogiephilboogie Posts: 7,438member
    So, WSJ got it wrong, and the analysts got it right.

    Pity though, I really was looking forward to this, and the mind boggling numbers resulting from it. Oh well, maybe next year.
  • Reply 3 of 56
    gqbgqb Posts: 1,934member
    Quote:

    Originally Posted by PhilBoogie View Post



    So, WSJ got it wrong, and the analysts got it right.



    Pity though, I really was looking forward to this, and the mind boggling numbers resulting from it. Oh well, maybe next year.

    It simply means that the Chinese are pulling their traditional dick moves right up til the last minute. It will happen soon enough.

  • Reply 4 of 56

    This is a little misleading. 

     

    A deal could be signed, and for legal, marketing, and other reasons, both firms are not admitting the deal. 

     

    Did everyone ALREADY forget about PrimeSense less than a month ago? One day it was denied by PrimeSense then, just days later, it was confirmed...

     

    Here's a slightly more grounded theory: Both firms are publicly traded, and (in the US) Securities regulations, such as Reg FD, require that "material information be disclosed to all investors at the same time". Hence, the secret nature of these negotiations. 

    Note that China Mobile didn't say "No", they said "ongoing" and "Nothing to announce right now". 

     

    If I was China Mobile and scheduled a huge event around my 4G announcement, I wouldn't want to spoil it by giving up a secret before the date. If I was Apple, I wouldn't want to screw my partner and announce something before their big day. 

    Expect Tim Cook on the dias with CM Chairman on Dec 18 - which, will be one hell of a Christmas gift to all investors. 

  • Reply 5 of 56
    forthought wrote: »
    This is a little misleading. 

    A deal could be signed, and for legal, marketing, and other reasons, both firms are not admitting the deal. 

    Did everyone ALREADY forget about PrimeSense less than a month ago? One day it was denied by PrimeSense then, just days later, it was confirmed...

    Here's a slightly more grounded theory: Both firms are publicly traded, and (in the US) Securities regulations, such as Reg FD, require that "material information be disclosed to all investors at the same time". Hence, the secret nature of these negotiations. 
    Note that China Mobile didn't say "No", they said "ongoing" and "Nothing to announce right now". 

    If I was China Mobile and scheduled a huge event around my 4G announcement, I wouldn't want to spoil it by giving up a secret before the date. If I was Apple, I wouldn't want to screw my partner and announce something before their big day. 
    Expect Tim Cook on the dias with CM Chairman on Dec 18 - which, will be one hell of a Christmas gift to all investors. 

    If the deal not announce on 18th, how much can aapl drop ? Nightmare for Apple investors ?

    If the deal really inked , china mobile can always say " we decline to comment . " or if they want to announce TOGETHER , China mobile can always say " we will have announcement later "
  • Reply 6 of 56

    My guess: The WSJ just got played by China. This is China's way of trying to put pressure on Apple to take its deal or suffer the consequences of a drop in stock price if the deal falls through.

     

    My advice to Apple: Screw 'em. If the stock price drops, then that's more cheap stock for Apple to salt away with its stock buyback program. And right now, Apple is barely keeping up with demand on its red-hot products, so they don't need them as a customer as much as CM needs Apple as a lure. Every day that goes by leading up to Chinese New Year is another day CM loses customers who want the iPhone to their competitors.

     

    Edit: I have a considerable amount of my retirement capital in AAPL, so I'm speaking as a stockholder.

  • Reply 7 of 56
    WSJ NEVER does Apple any favors in their reporting. They COULD have at least checked with Apple PR directly for a comment before they issued the consummation of the deal as being FACT, even though they admitted they had only one (anonymous) source instead of at least the normal two. Apple would have told them that there was nothing to announce. Instead WSJ wanted to jump the gun, and they got a false scoop. Problem is, this victimizes Apple as perhaps looking unorganized or overly anxious, especially in the popular Chinese perception and in the potential investor's mindset?
  • Reply 8 of 56
    Quote:

    Originally Posted by Sacto Joe View Post

     

    My guess: The WSJ just got played by China. This is China's way of trying to put pressure on Apple to take its deal or suffer the consequences of a drop in stock price if the deal falls through.

     

    My advice to Apple: Screw 'em. If the stock price drops, then that's more cheap stock for Apple to salt away with its stock buyback program. And right now, Apple is barely keeping up with demand on its red-hot products, so they don't need them as a customer as much as CM needs Apple as a lure. Every day that goes by leading up to Chinese New Year is another day CM loses customers who want the iPhone to their competitors.

     

    Edit: I have a considerable amount of my retirement capital in AAPL, so I'm speaking as a stockholder.


     

    I agree. Any deals that are harmful or not beneficial to Apple, don't sign them. Even for the biggest market in the world. Clearly, the black market for iPhones proves there is demand. Let the black market flourish and let customers in China punish China Mobile by leaving for a competitor.

  • Reply 9 of 56
    512ke512ke Posts: 782member
    The WSJ. Don't. Believe. A. Word.

    Worst newspaper ever.

    Least professional. Least reliable.

    Piece of crud WSJ.
  • Reply 10 of 56
    Quote:

    Originally Posted by 512ke View Post



    The WSJ. Don't. Believe. A. Word.



    Worst newspaper ever.



    Least professional. Least reliable.



    Piece of crud WSJ.

     

    This may be a sometimes valid criticism, but it's more applicable to the New York Times.

  • Reply 11 of 56
    mj webmj web Posts: 918member

    I personally believe the deal is done. 

  • Reply 12 of 56
    This may be a sometimes valid criticism, but it's more applicable to the New York Times.

    NYT sometimes misses the mark but you have no idea what you're talking about
  • Reply 13 of 56
    As far as I know, window displays and signs in china mobile stores all over mainland china are explicitly indicating the wait is over and iPhones are coming to china mobile. It does not seem to be that a well kept secret anyway and I am not sure what all the denials are about.
  • Reply 14 of 56
    Originally Posted by george li View Post

    As far as I know, window displays and signs in china mobile stores all over mainland china are explicitly indicating the wait is over and iPhones are coming to china mobile.

     

    Really? Could you snap a few and upload them?

  • Reply 16 of 56
    Btw, I did not snap those pictures as I am in US. But They are all over the web on Chinese tech blogs and online forums.
  • Reply 17 of 56
    512ke512ke Posts: 782member

    I'm sorry, I don't mean to rag against the WJS.  It's true they have misreported several big stories on Apple recently, but then so does every major newspaper.  It's, publish first, ask questions later.  Everybody wants to be first and get the clicks/reads/eyeballs.

     

    This is so disappointing.  I really hope a deal is announced soon.  It sucks being an Apple investor.  When there is the slightest tremor of negativity, the stock goes way down.  And this isn't just a tremor.  China Mobile is an earthquake at least in terms of public perception!

     

    C'mon Apple make it not only an iPad Christmas, but also an APPL Christmas.

     

    That's what I want for Christmas, Santa!  APPL UP not APPL back down to 390.

     

    I will leave cookies and milk!

  • Reply 18 of 56
    esoomesoom Posts: 155member
    Quote:

    Originally Posted by george li View Post



    Btw, I did not snap those pictures as I am in US. But They are all over the web on Chinese tech blogs and online forums.

    Thanks, that's comforting to see.

  • Reply 19 of 56
    hill60hill60 Posts: 6,989member
    philboogie wrote: »
    So, WSJ got it wrong, and the analysts got it right.

    Pity though, I really was looking forward to this, and the mind boggling numbers resulting from it. Oh well, maybe next year.

    Maybe the 18th December, like Apple they play their cards close to their chest.
  • Reply 20 of 56
    Does Rupert Murdock, have any interest in WSJ? Anything is possible
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