Apple 2.0

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iPhone hardball and soft sell in China


Apple airs its first Chinese-language ads as reports of retailer intimidation emerge

Supplementing print advertisements like the one at right, the first Apple-produced iPhone ads appeared on Chinese TV over the weekend.

They come on the heels of the device's somewhat sluggish start last month in the world's largest mobile phone market (more than 720 million subscribers).

Apple's (AAPL) local carrier, China Unicom (CHU), reported signing up only 5,000 new subscribers in the iPhone's first four days of sale, a result Western analysts viewed as disappointing.

In addition to the several reasons put forward — e.g., high prices, lack of Wi-Fi, a market saturated with knock-off and black-market phones — iPhonAsia's Dan Butterfield has added another: strong-arm tactics on the part of China Unicom's chief rival, China Mobile (CHL).

According to Butterfield, some of the country's most important mobile phone distributors are not yet selling the iPhone despite signed agreements with China Unicom. Reason: threatening letters from China Mobile warning them not to.

"The precise wording of these letters is unknown," writes Butterfield, "but this is more than just a suggestion." He then quotes — in translation — an article in sina.com:

"Many cell phone distributors received formal notification that 'Selling iPhones is not recommended,' or 'Selling iPhones is not allowed or China Mobile will fine you or stop cooperation with you.' "

Tactics like this, as 9to5Mac's Seth Weintraub puts it, "make Verizon and AT&T's little sissy war seem silly."

Below the fold: An iPhone ad with a Chinese accent and Chinese apps.

See also:

[Follow Philip Elmer-DeWitt on Twitter @philiped]

8 Comments | Add a Comment | Email

I hardly think the composer of such interesting article had spoken language in mind when he used the word "accent." I DO, however, believe the author meant "distinct character or tone, or pattern" that was descriptively Chinese. After all, that meaning is where we get our word "accentuate."

Posted By Josephus N., Nanjing, China: November 24, 2009 7:48 AM

How typical of the Chinese to use subtle "threats"

Posted By John, New York, NY: November 23, 2009 11:44 AM

It's convienent to blame China mobile. But, when unlocked, Wi-Fi capable iphones are available for less money on the black market, soft sales are a given.

Posted By Frank A NYC: November 23, 2009 9:02 AM

No, just because you are a Chinese person speaking Chinese you are not necessarily using a Chinese accent. There a plenty of American Citizens, for example, that speak English, however, do not do so with an American accents. Perhaps they are immigrants, etc.

Posted By Charlie, Madison, WI: November 23, 2009 8:45 AM

As usual bickering between two US companies effects overseas businesses. It's a phone people, sell it and raise the damn economy a touch every little helps. Now isn't the time for companies to be in competition for 'exclusivity' rights.

Posted By Lee Vraven: November 23, 2009 8:05 AM

It's easy to blame China Mobile. Still the real reason for the poor iPhone performance is the price of the device.

Posted By Vova, Riga, Latvia: November 23, 2009 4:20 AM

Chinese value one above all else and are not constrained by moral principle. Nations with a moral bearing, who follow some principle (other than money is #!) can never win. U.S. needs to wake up and smell the tea; it must realize that terrorists, including economic terrorists, always win. China will never become moral. US will never lower itself. US will lose.

Posted By Gao Wei Li, Taipei, Taiwan: November 22, 2009 10:24 PM

I'm curious: why write "with a Chinese accent" rather than "in Chinese". Surely a Chinese person speaking Chinese is de facto speaking with a Chinese accent.

Posted By Kurt, San Francisco, CA: November 22, 2009 7:20 PM
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Philip Elmer-DeWitt

Philip Elmer-DeWitt
Steve Jobs, goes the old joke at Apple, is surrounded by a reality distortion field; get too close and you might believe what he's saying. Apple has made believers out of millions of customers — and made a lot of investors rich — but Elmer-DeWitt believes that an ounce of skepticism never hurts when writing about the company. He should know. He's been covering Apple – and watching Steve Jobs operate — since 1982.
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