Chinese consumers snapping up iPhones, whatever it takes

(AFP PHOTO / LIU Jin)

If it rings true that any publicity is good publicity, then the people at Apple must be happy with what is going on in China as the new year begins.

Hardly a day goes by without its iPhone making headlines in the media for matters relating to the Chinese consumers' reaction to the launch of the product and on to controversies about how its usage is being applied in a country that likes to keep a very close watch over all mediums of communication.

Initially, things were all doom and gloom for the iPhone with it taking a reported 40 days from the late October launch of the device for sales to top 100,0000.

Not that bad a figure, in most markets, but barely a ripple when you consider mainland China has 720 million registered mobile phone users.

But a major advertising campaign by China Unicom - the state-backed acknowledged distributors of the phone - saw sales then treble in the following two weeks to 300,000 by December 27.

But down in Hong Kong, retail outlets say they are still selling tens of thousands of the devices each month to mainland Chinese customers attracted both by far cheaper prices and by the fact that - due to government regulations - the mainland Chinese version of the phone does not come wi-fi ready.

Unicom's iPhones sell for between 4,999 and 6,999 yuan (512 and 717 euros) - about 1,000 yuan (102 euros) more than in Hong Kong.

"About 70 percent of our customers buying iPhones are from the mainland,'' Maxwell Leung, a salesman at Fortress, one Hong Kong's largest electronics retailers, told the China Daily newspaper.

Hong Kong's iPhones are wi-fi ready, too, as are the "pirate'' iPhones available at Beijing's Zhongguancun electronics shopping district and imported from the US or Hong Kong and those available through an estimated 1,000 online shops. Some of those online shops sell 30 to 60 phones a month, according to the online auction site Taobao.com.

Little wonder a recent report from the telecommunications consulting service company Ovum claimed there were already more than one million iPhones in operation in mainland China by the end of May, 2009 - almost five months before they were "officially'' available.

Some bad press also surfaced over the weekend with claims that China Unicom - which is government-backed - had pressured Apple into blocking iPhone applications that linked users to sites detailing information about controversial figures such as the Dalai Lama.

It remains to be seen if such moves - if proven - have any effect on sales because, as one iPhone owner told the China Daily: "Castrated iPhones make [Chinese consumers] feel something is missing.''

MS