iPhone enjoys mixed fortunes in Asia

03 December 2009

BEIJING: Sales of Apple's iPhone have been modest in China, but the device is performing considerably better in South Korea, despite the fact it faced major obstacles in both of these markets.

The pioneering product was introduced in China in November, with just 5,000 units being purchased in its first few days on sale, according to China Unicom, its carrier in the world's most populous state.

China Unicom backed the launch with a nationwide marketing campaign, including buying up outdoor ads in thousands of bus shelters, as well as in subway stations, and on public transport.

Looking forward, it has forecast that around 700,000 owners of 3G-ready handsets – or 10% of this user base – are likely to switch to the American multinational's offering in the next two years or so.

Shaun Rein, the managing director of the China Market Research Group, argued "it is too early to declare the iPhone a failure in the country, but the launch missed expectations by a mile."

One key issue is said to be price, as an iPhone handset costs anywhere between 5,000 yuan ($732; €485; £439) and 7,000 yuan at present, depending on the overall package selected by owners.

Xiang Ligang, ceo of CCTime, a mobile-focused online publication, said "the price of the iPhone alone is too high for Chinese customers. I believe people in China would also go 'crazy' if China Unicom lowered the price of the iPhone alone to 2,000 yuan."

By contrast, the touchphone was unveiled in South Korea last weekend, having received a total of 65,000 pre-orders, with KT, Apple's local partner, targeting around 500,000 sales overall.

This is despite the fact the iPhone is considered to be a relatively late entrant into the technologically-advanced market, where domestic manufacturers like Samsung and LG are already both in strong positions.

In response, KT has developed a range of price plans, such as making the 32-gigabyte model available for free when consumers take up a two-year service costing $115 a month.

Xiang described the iPhone's figures in Korea as "impressive", adding that, alongside technical advantages such as being WiFi enabled, a "main factor in the strong sales performance is the price."

Data sourced from Wall Street Journal, Media, Forbes; additional content by Warc staff