Apple (AAPL) And China Mobile In Imminent iPhone 5 Partnership

Apple (AAPL)’s iPhone 5, which goes on sale on Friday with a bigger screen and 4G wireless technology, might be coming to the world’s largest mobile operator, China Mobile, by early 2013. The word comes from CNBC’s Jean Chua who says Apple’s breakthrough partnership with China Mobile, the country’s largest mobile carrier, appears to be “imminent”.

The report also notes that striking a deal with such a large carrier could serve a huge victory for Apple, which has seen the penetration levels of the iPhone in China remain inferior to its levels in the U.S. and other developed markets. Apple currently holds a 7.5% market share in the Chinese smartphone market after losing significant ground in recent months due to competition from local players like ZTE and Lenovo, according to research firm IDC. The latest figures also reveal that Samsung, Apple’s main competitor and legal foe, remains the leader in China with 20% share of the market. However, after the recent deals with China Unicom and China Telecom and now with China Mobile — a company with more than 680 million subscribers ; netting over 10 million iPhone users, — Apple can recuperate its market share loss and hopefully grab a stronghold of the Chinese smartphone market in the near future.

If China Mobile can convince only 4% of its total 683 million subscribers to switch to the iPhone 5, that’s an additional 27.3 million smartphone sales for Apple, estimates HSBC. The bank calculates that there are currently about 22 million iPhone users in China.

[via CNBC] “It’s going to mean a significant increase of Apple sales into China,” Tucker Grinnan, HSBC’s Head of Regional Telecom Research said on CNBC Asia’s “Squawk Box” on Thursday, adding that the latest development represents a game changer for Apple in China, a country that is expected to have more than 1 billion mobile subscribers by the end of the year.

Apple’s Chief Executive Officer Tim Cook said in the October 2011 earnings call: “For China — the sky’s the limit there. I’ve never seen so many people rise into the middle class who aspire to buy Apple products.”

China accounted for $3.8 billion in revenue in Apple’s Q3 and $8.8 billion cumulatively in the first three quarters of this year, making Mainland key to Apple’s bottom line.

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