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iPhone

Apple reaches iPhone deal with China's largest carrier

Associated Press
Published | Updated
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    Dec. 23, 2013: Customers look at iPads near an advertisement for the iPhone 5C at Apple's retail outlet in Beijing. Apple and China Mobile announced a long-anticipated agreement Monday to bring the iPhone to the world's biggest phone company. (AP Photo/Ng Han Guan)

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    September 20,2013: Chinese employees cheer a customer after he bought a new iPhone at an Apple store in Wangfujing shopping district in Beijing. (AP Photo)

BEIJING – Apple says it has reached a deal to bring the iPhone to China Mobile, the world's biggest phone carrier.

The deal ends a lengthy courtship and could boost sales of the iPhone in China. The iPhone, once hugely popular in China, has been eclipsed by the rise of lower-priced rival smartphones from Samsung and Chinese companies.

The iPhone 5S and 5C will go on sale in Apple stores and China Mobile stores beginning Friday, Jan. 17. China Mobile customers can register for phones starting Wednesday.

The companies didn't announce pricing or the terms of the agreement.

The iPhone, while popular around the world, has faced tough competition in recent years from cheaper smartphones running Google's Android software. Collectively, Android phones far outsell Apple's iPhone.

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Analysts speculate that Apple could sell another 10 million to 40 million more phones if it reached a deal with China Mobile.

Apple CEO Tim Cook told the official Xinhua News Agency in January that he expects China to surpass the United States as its biggest market. Some 50 million iPhones have been sold in China in the past 2 1/2 years, according to analyst estimates.

China Mobile, which is owned by the Chinese government, has more than 750 million mobile accounts. However, a survey by Bernstein Research said some China Mobile consumers use smaller carriers for data service. Apple already has agreements with China Telecom Ltd. and China Unicom Ltd., which have about 455 million mobile accounts.

With China Mobile, Apple gains access to a bigger, more robust network. The network has faster data speeds and suffers fewer complaints about dropped calls than those of two smaller state-owned rivals.

China Mobile wants to have the world's largest 4G network, and the new iPhones might help it win over customers. The company received approval to start operating the faster network earlier this month and plans to have 4G services available in 16 cities by the end of 2013. It aims to provide coverage for 340 cities by the end of 2014.

The agreement could lift Apple's iPhone sales at a time in which other manufacturers are making inroads in China's smartphone market.

Research firm Canalys says South Korea's Samsung sells one of every five smartphones in China, followed by Lenovo Group. Apple's sales are growing but it was in fifth place in the latest quarter, with a 6 percent market share.

For the mass market in a country with an average annual income of about $4,000 per person, less than one-tenth the U.S. level, newcomers such as China's Xiaomi offer smartphones that run Google Inc.'s Android system for as little as 799 yuan ($125).