iPhone Goes To China

          This Friday Apple finally launched its official Iphone sales in China with the non-contract price of $733.

When my eyes caught these words in the news feed, i was more than surprised. Two years later after the official release the most popular device ever reached the greatest mobile market with the most ridiculous price. But let me explain first what is the state of affairs with the Apple deal in China.

Chinese mobile market calculates more than 700m users. China Unicom is the country's second-largest carrier and the first telecoms group to make a distribution deal with Apple in China. The price set for the device without a mobile contract is 4,999 yuan ($733) and can reach 6,999 yuan ($1,025) depending on the model. China Daily states that this is more than half of the country's per capita urban disposable income, and about 25% higher than it is sold in Hong Kong.

However, the problem that is keeping buyers away is not the high price, but the phone's functionality. As the Associated Press noted this week, the Unicom handsets are missing one very important feature. Unicom's iPhones lack WiFi because it was temporarily banned by Beijing, which was promoting a rival Chinese system. The ban was relaxed in May after manufacturing had begun. Yi Difei, a Unicom spokesman, expressed the hope to have this feature added in the next batch of phones.

Moreover, the lack of WiFi is worsened by the presence of smuggled and grey phones. All the articles I've read are trying to evade discussing these consequences. Financial Times make a slight "afraid" remark, China Daily praises the celebrations and figures out only the positive points of buying the device (actually, it sounds more like a pr-campaign than a news article), two articles in Wall Street Journals turned to be the most informative: one gave the overview of the launching party and the other analysed the cost equation of the device. But for me the absence of WiFi and such a mature grey market are the key signals that the iPhone will have to fight its way to the buyers' hearts. Whatever the newspapers say, the key point of the device is internet everywhere. The 3G networks in China are developed, but not that much. WiFi is still much more popular. And the fact that Apple came officially only now let the people either smuggle the device from abroad (remember, the US price at the beginning was only $199), or buy it on the grey market. Needless to say, Chinese grey market produced half of the grey iPhones that were then sold all over Europe and Russia.

Actually, i still can't understand the Apple's policy in China or Russia. I remember the iPhone launch in Moscow last year. Guess, it was a fiasco. The prices were too high (around $1000 per 8GB model), the demand was too low. Everyone who wanted this phone has already brought it from US or (!) China. The only plus in buying the official version was good quality operating system that didn't need to be reinstalled once in two-months. However, the updates appear so often tha it makes the difference between versions quite vague. Besides the Chinese market remains very Windows-oriented, and this is another obstacle for Apple to fall short there.