At the present time, the iPhone is not available to the majority of people in China. This is due in large part to the inability for Apple to reach an agreement with China Mobile. Complicating matters even further is the fact that the iPhone is made available by the two smaller carriers in the country: China Telecom Corporation Limited (NYSE:CHA) and China Unicom Limited (NYSE:CHU). As early as next week, both companies will begin selling AAPL’s iPhone 5.
While China Telecom and China Unicom both have growing subscriber bases, China Mobile holds an approximate 60-70% of the country’s mobile telecom market, making it the proverbial “big fish,” that can be quite a catch for the Cupertino-based tech giant.
With all this in mind, though, there is still hope for the future. At a conference yesterday, Li stated, “the business model and benefit sharing still need further discussion.” Thus, it appears that the telecom’s CEO is still very open to negotiating a partnership with Apple Inc. (NASDAQ:AAPL).
For a more detailed interpretation, we don’t have to look any further than Teck-Zhung Wong, an analyst with IDC, who has shared that “Li’s comment suggests that China Mobile has no intention of simply gifting Apple access to its huge subscriber base without extracting a pound of flesh from Apple.” In other words, China Mobile has something that Apple wants – access to the largest network in the world. With this in mind, it is easy to see that Li is in the driver’s seat for the time being.
Could this situation come back to haunt Apple Inc. (NASDAQ:AAPL) and investors again in the future? Let us know your thoughts in the comments section below.
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