China Unicom positive about future sales of Apple's phones

An official iPhone store on Taobao.com, the biggest Chinese e-commerce website and similar to eBay, has sold just two 8GB iPhones and three 16GB iPhones over two weeks, according to figures on the site.

The store began operations in the middle of November, a few weeks after China Unicom began offering the first official iPhones in China.

China Unicom is also selling iPhones through its own website, which does not list sale figures.

But Taobao is China's top online retail site, and many users turn to it to buy items like mobile phones and laptops.

The China Unicom iPhones have to compete with iPhones brought into the country from abroad, which users have bought since long before the official handset arrived.

The iPhones bought outside the Chinese mainland have WiFi, which was removed from the China Unicom iPhones to comply with local regulations. The official handset is also more expensive than iPhones bought elsewhere.

The 32GB iPhone 3GS with no service contract costs 6,999 yuan on the Chinese mainland, compared to about $800 in nearby Hong Kong.

Slow sales at the online shop follow earlier signs that the official iPhone is unpopular in China.

China Unicom has reportedly said it sold just 5,000 iPhones in the few days after its launch.

That contrasts with the more than 60,000 online orders that South Korean carrier KT received before launching the iPhone in its country at the end of November.

China is now with the world's largest number of mobile subscribers at 700 million, a far bigger market than South Korea.

Difficulty using the online App Store to purchase features for the iPhone, made by US-based Apple Inc, might be another strike against the iPhone for Chinese users.

Credit cards are increasingly common in China, but their holders rarely use them to make small payments via mobile phone, local consulting firm Analysys International recently reported.

Credit card penetration also remains low among young people of the sort that would like the App Store, the firm reported.

Many Chinese make payments via mobile phone but do so with prepaid cards sold by local carriers.

The App Store will need to add new payment options and more localized content to win more users in China, Analysys International reported.

China Unicom has kept outwardly positive about the iPhone's prospects. A company executive in Nobember said China Unicom expects 10 percent of China's 3G users to buy iPhones, according to Chinese media reports.

China Unicom has sold more than 100,000 iPhones since it launched the country's first official sales of the handset at the end of October, 2009.

The company gave no other details on its iPhone sales but called the handset a "great success." The carrier is selling both the iPhone 3G and iPhone 3GS.

Many wealthy urbanites in China owned iPhones before the phone officially launched there. Ovum, a consultancy, estimated months ago that there were already 1 million iPhones in China.

Reuters

(China Daily 12/28/2009 page12)