China Mobile has confirmed that Apple CEO Tim Cook met with the Chinese company’s chairman Xi Guohua in Beijing to discuss “matters of cooperation,” Reuters reports.
A meeting between China Mobile and Apple is crucial, given that China Mobile is the only Chinese operator that does not offer iPhones and iPads, despite being the world’s largest mobile phone operator with over 700 million subscribers. This represents a huge untapped opportunity for Apple.
Rumors of a cheaper iPhone have been building up, with Bloomberg saying earlier this year that the device will be sold between $99 and $150 by the end of this year. If the rumors are proven true, this could give Apple greater strides in China’s mobile market — one that is currently dominated by lower-priced Android smartphones.
We earlier noted that local media have speculated that China Mobile will carry the next-generation iPhone when it is released. China Mobile has hinted at ongoing negotiations over the iPhone in the past, even suggesting that Apple had promised to release an iPhone compatible with the carrier’s upcoming 4G network.
This isn’t the first time the two company executives have met this year. In January, both also crossed paths when Cook visited China.
Apple has been on a tear in China in recent years, but in its fiscal Q3 earnings the company revealed that revenue in the region was down a surprising 43 percent sequentially and 14 percent year-on-year. Cook noted on an earnings call that Hong Kong had contributed to the drag, as sell-through in mainland China was up 5 percent year-on-year after accounting for inventory changes.
Cook’s meeting with Xi therefore comes at an opportune time for Apple to up its game in mainland China. China Mobile’s TD-SCDMA 3G network has proved difficult since it requires devices that run on it to include in-built support for the unique network, something that Apple — for one — has not done. However, rumors have long suggested that Apple will support the next-generation TD-LTE network that China Mobile is set to roll out.
Despite the fall in Q3 revenue for China, Cook noted that the $4.6 billion figure was still a strong showing compared to a few years ago, when it was just in the hundreds of millions. Earlier this year, Cook predicted that China will eventually become Apple’s largest market and have more than 25 retail stores. It currently operates eight stores in four cities on the mainland.
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