Apple's iPhone drops to fifth place in Chinese smartphone market

Posted:
in iPhone edited February 2017
Apple continued to struggle for ground in China during the December quarter, ceding fourth place in the country's smartphone market under pressure from local brands like Huawei and Xiaomi, according to new research data.




The 43.8 million iPhones Apple shipped in the country was down 18.2 percent year-over-year, and led it to slide into fifth place, research firm Canalys said this week. The company was in fact eclipsed by Xiaomi, even though the latter saw shipments fall 21 percent to 51.4 million.

Leading the market was Huawei with 76.2 million. Oppo slotted into second with 73.2 million, while Vivo managed 63.2 million.




Once expected to be a major growth driver for Apple, China has instead become a battle -- perhaps the biggest obstacle being the high price of the iPhone versus local Android-based options.

When announcing its December-quarter results, the company noted that revenues were down 8 percent in the country. CEO Tim Cook blamed this partly on currency values, but also commented that the market was "not without challenges."

Canalys analyst Jessie Ding suggested that as elsewhere, many Chinese may be content with older iPhones and waiting for this year's models, led by the "iPhone 8," sometimes known as the "iPhone X."

Although it could be a limited model costing upwards of $1,000, the "iPhone 8" is expected to offer an edge-to-edge OLED screen, replacing a physical home button with a virtual "function area." To fill in for Touch ID, the phone may rely on advanced facial recognition.
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Comments

  • Reply 1 of 54
    I don't believe any company claiming to have reluable sales data out of China, including any claims of their government.
    macseekerlkruppadamcgregg thurmanwatto_cobra
  • Reply 2 of 54
    cornchipcornchip Posts: 1,171member
    Sky is falling
    ai46watto_cobra
  • Reply 3 of 54
    slurpyslurpy Posts: 5,090member
    Doomed! So Doomed! 

    Isnt this the implied conclusion of any store concerning Apple? That the inevitable downfall is just around the corner, and if it's not that corner, then it's SURELY the next one!
    lkruppadamcStrangeDayspscooter63gregg thurmanai46watto_cobra
  • Reply 4 of 54
    At least for me, much of the value of Apple's products depends on the ecosystem. 

    I wonder if many Chinese are not yet in a position to appreciate the value of that ecosystem, or if perhaps the ecosystem isn't as fully developed in China. 
    GeorgeBMacpscooter63gregg thurmanpatchythepiratewatto_cobra
  • Reply 5 of 54
    irelandireland Posts: 17,534member
    Goodbye poor Apple.
    edited February 2017 lkruppSpamSandwich
  • Reply 6 of 54
    What percentage of the profit does Apple make in China?
    lkruppai46
  • Reply 7 of 54
    lkrupplkrupp Posts: 6,618member
    From the tone of the responses here so far I’m happy to see that a lot of us are finally getting it.
    adamcpscooter63ai46watto_cobrajony0
  • Reply 8 of 54
    ksecksec Posts: 1,545member
    Looking at those Numbers, it is actually not that bad.

    Only Apple provide Actual Product Sold. Others are Shipped. I expect the number to be off by as much as 5% for Oppo, Vivo and Xiaomi.

    Even with Huawai, most of the Top 5, likely 90%+ of their Sales are below $300USD, the starting price for iPhone SE, is $400 USD+.

    Sometimes I wonder, why all the Top 4, uses Component from Manufactured in GF, Samsung, TSMC from Qualcomm etc, None of the top 4 have to pay import Tax.The iPhone however require an Import tax, making it 17 to 20% more expensive.
    watto_cobra
  • Reply 9 of 54
    irelandireland Posts: 17,534member
    What percentage of the profit does Apple make in China?
    I'm more interested in why you care? Since when did we fall in love with a company for how much money they are making at a certain moment in China? If that's our metric then we may as well give up now. It's so uninteresting to me whether they have 25% or 85% profit of the Chinese market. The source of all of these stories is greed anyway, because we're obsessed with numbers and money and Wall St. and measuring everything on a chart and the media is completely fucked up about this subject matter. Who gives two shits. I think we should all refocus on design and easy of use and company direction and company philosophy where the interesting creative stuff is to talk about. Enough with the boring comparisons. The only people who should be interested in this are stockholders and they have a vested interest in their argument, so their argument every time may as well be three words: "I own AAPL". Look at Sog, his opinion changes depending on how the stock is doing. Nothing else matters to him. Tim went from being a Nazi to being Jesus in less than the space of a year. Think of how may dull, uncreative conversations have arisen from that. Peace.
    edited February 2017 gatorguylostkiwiSpamSandwichzimmermannwatto_cobra
  • Reply 10 of 54
    ireland said:
    What percentage of the profit does Apple make in China?
    I'm more interested in why you care? Since when did we fall in love with a company for how much money they are making at a certain moment in China? If that's our metric then we may as well give up now. It's so uninteresting to me whether they have 25% or 85% profit of the Chinese market. The source of all of these stories is greed anyway, because we're obsessed with number and money and Wall St. and measuring everything on a chart and the media is completely fucked up about this subject matter. Who gives two shits. I think we should all refocus on design and easy of use and company direction and company philosophy where the interesting creative stuff is to talk about. Enough with the boring comparisons. The only people who should be interested in this are stockholders and they have a vested interest in their argument, so their argument every time may as well be: "I own AAPL".
    Yes.  Philosophically, Apple is taking a great approach to products. Even content creation apps are looking better.  The premium value is there, so sales will follow.  The end is preexistent in the means.  
    watto_cobra
  • Reply 11 of 54
    ireland said:
    What percentage of the profit does Apple make in China?
    I'm more interested in why you care? Since when did we fall in love with a company for how much money they are making at a certain moment in China? If that's our metric then we may as well give up now. It's so uninteresting to me whether they have 25% or 85% profit of the Chinese market. The source of all of these stories is greed anyway, because we're obsessed with numbers and money and Wall St. and measuring everything on a chart and the media is completely fucked up about this subject matter. Who gives two shits. I think we should all refocus on design and easy of use and company direction and company philosophy where the interesting creative stuff is to talk about. Enough with the boring comparisons. The only people who should be interested in this are stockholders and they have a vested interest in their argument, so their argument every time may as well be three words: "I own AAPL". Look at Sog, his opinion changes depending on how the stock is doing. Nothing else matters to him. Tim went from being a Nazi to being Jesus in less than the space of a year. Think of how may dull, uncreative conversations have arisen from that. Peace.
    I'm with you on this! As if any damn statistic would change my mind or even sway me against my unshakable love for Apple products—especially my iPhone 7+! 
    StrangeDayswatto_cobra
  • Reply 12 of 54
    MacProMacPro Posts: 17,892member
    What percentage of the profit does Apple make in China?
    Come on, asking a sensible question in this day and age?  What are you thinking?  Don't you follow Gatorguy ... Volume is all that matters!  

    Meanwhile, I'm just hoping Wall Street makes Apple's stock temporary dive over this so I can buy some more AAPL before we are off on the road to >$150 :)
    ai46watto_cobra
  • Reply 13 of 54
    blastdoor said:
    At least for me, much of the value of Apple's products depends on the ecosystem. 

    I wonder if many Chinese are not yet in a position to appreciate the value of that ecosystem, or if perhaps the ecosystem isn't as fully developed in China. 
    It will always be cheaper and easier to roll out a gadget with a free OS and little or no ongoing support than to roll out an Apple product with integrated hardware & software, ongoing support in the form of OS upgrades, automatic backups, ongoing security upgrades, etc., etc., etc.....

    Both Apple and Android fan bases tend to compare devices based on their latest glitz feature as it comes out of the box.   Using that as the criteria for comparison insures that the Apple product will always lose...  The low cost manufacturers need only copy what Apple did six months earlier and release a 'new & improved' version.  

    Apple has a marketing dilemma because a large part of what they sell cannot be seen as the gadget comes out of the box.  And, most people do not seem to even know that it exists...  No matter how much Apple tries to produce a lower cost option, it will always need to charge a premium in order to pay for the infrastructure that goes around that gadget and makes it an outstanding product that "just works".

    I saw the same thing transpiring in the battle between the mainframe world and the PC world back in the 90's.   The PC applications were always cheaper -- not because PCs were invariably cheaper or the software was inherently cheaper -- but because they omitted features that made the mainframe versions secure, dependable and stable.  I fear that Apple may go the way of the mainframe if it does not find a way to market its infrastructure effectively.
  • Reply 14 of 54
    gatorguygatorguy Posts: 19,816member
    MacPro said:
    What percentage of the profit does Apple make in China?
    Come on, asking a sensible question in this day and age?  What are you thinking?  Don't you follow Gatorguy ... Volume is all that matters!
    LOL! You are apparently one who doesn't follow me since you've confused someone else's opinion for mine. But's that's OK, whatever gets you a click.  :)
    SpamSandwich
  • Reply 15 of 54
    mike54mike54 Posts: 294member
    I'm surprised if Apple is really 5th. iPhones are priced for the US market. It maybe a global economy from a certain perspective, but its not as far wages and purchasing power goes. Maybe iPhones should be priced relative to the local price of 1kg of rice in both countries.
    edited February 2017
  • Reply 16 of 54
    512ke512ke Posts: 781member
    I think Apple's market share is always going to be limited over the long term by its premium prices. Think BMW and Lexus. 
    watto_cobra
  • Reply 17 of 54
    Most pathetic comments here I've read in a long time.
    Reading them sort of reminds me of a "Peanuts" cartoon, or something. I don't know if it's "A Charlie Brown Christmas" or "It's the Great Pumpkin, Charlie Brown".
    SpamSandwich
  • Reply 18 of 54
    blastdoorblastdoor Posts: 1,888member
    blastdoor said:
    At least for me, much of the value of Apple's products depends on the ecosystem. 

    I wonder if many Chinese are not yet in a position to appreciate the value of that ecosystem, or if perhaps the ecosystem isn't as fully developed in China. 
    It will always be cheaper and easier to roll out a gadget with a free OS and little or no ongoing support than to roll out an Apple product with integrated hardware & software, ongoing support in the form of OS upgrades, automatic backups, ongoing security upgrades, etc., etc., etc.....

    Both Apple and Android fan bases tend to compare devices based on their latest glitz feature as it comes out of the box.   Using that as the criteria for comparison insures that the Apple product will always lose...  The low cost manufacturers need only copy what Apple did six months earlier and release a 'new & improved' version.  

    Apple has a marketing dilemma because a large part of what they sell cannot be seen as the gadget comes out of the box.  And, most people do not seem to even know that it exists...  No matter how much Apple tries to produce a lower cost option, it will always need to charge a premium in order to pay for the infrastructure that goes around that gadget and makes it an outstanding product that "just works".

    I saw the same thing transpiring in the battle between the mainframe world and the PC world back in the 90's.   The PC applications were always cheaper -- not because PCs were invariably cheaper or the software was inherently cheaper -- but because they omitted features that made the mainframe versions secure, dependable and stable.  I fear that Apple may go the way of the mainframe if it does not find a way to market its infrastructure effectively.
    A few points:

    1. The Android fan base does as you say. I'm not so sure about the iPhone base, at least not in the US. Maybe it's different in China.
    2. There are a lot of features of the iPhone that cannot just be copied 6 months later. The best example is the SOC -- the competition is literally years behind Apple in basic performance. 
    3. When you talk about the mainframe vs the PC, what you're really talking about is IBM vs Microsoft. IBM had grown fat and lazy. Their pace of innovation had slowed dramatically, yet they continued to charge very high prices. It's not that customers failed to appreciate the value of mainframes -- it's that IBM overcharged and under-delivered. If Apple follows that model (and frankly, when it comes to the Mac Pro, they have) then that's why they'll go the way of IBM. But while I think there are very legitimate gripes about how Apple has been doing with the Mac, it seems to me that Apple continues to add value to the iPhone year after year. I might not always agree with every decision, but they definitely keep the product moving forward. 

    so... I don't think there is any inevitable slide towards IBM. So long as Apple continues to innovate and charge a price commensurate with the value of that innovation, they'll be fine. It's not a foregone conclusion that Apple will do that, but it's certainly not a foregone conclusion that they won't. 
    pscooter63gregg thurmanwatto_cobra
  • Reply 19 of 54
    gatorguy said:
    MacPro said:
    What percentage of the profit does Apple make in China?
    Come on, asking a sensible question in this day and age?  What are you thinking?  Don't you follow Gatorguy ... Volume is all that matters!
    LOL! You are apparently one who doesn't follow me since you've confused someone else's opinion for mine. But's that's OK, whatever gets you a click.  :)
    I'm sure if you posted a link suggesting Google came up with this three years ago it would clear this all up. 
    pscooter63ai46watto_cobra
  • Reply 20 of 54
    gatorguygatorguy Posts: 19,816member
    gatorguy said:
    MacPro said:
    What percentage of the profit does Apple make in China?
    Come on, asking a sensible question in this day and age?  What are you thinking?  Don't you follow Gatorguy ... Volume is all that matters!
    LOL! You are apparently one who doesn't follow me since you've confused someone else's opinion for mine. But's that's OK, whatever gets you a click.  :)
    I'm sure if you posted a link suggesting Google came up with this three years ago it would clear this all up. 
    +1 :wink: 
    StrangeDays
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