Apple invitation for media event in Beijing on Sept. 11. Source: MacRumors.
China deserves its very own Apple Inc. (NASDAQ:AAPL) media event, apparently.
Nearly identical to the invitations sent out in the U.S., Apple Inc. (NASDAQ:AAPL) has now sent out invitations in China for a second event, just nine hours after its U.S. event. The event will be hosted in Beijing at 10:00 a.m. local time.
Invitations for satellite Apple Inc. (NASDAQ:AAPL) media events were sent out in Berlin and Tokyo, too. But its China’s media event garnering the most attention, and likely the cause of this morning’s rally in Apple stock.
Why would investors care? Looming on the horizon is a great behemoth: China Mobile Ltd. (ADR) (NYSE:CHL). A long-awaited arrangement with the world’s largest carrier would certainly merit its own media event.
There’s two ways to look at Apple Inc. (NASDAQ:AAPL)’s position in China.
1). Investors could consider the Cupertino tech giant’s paltry market share to be indicative of the company’s unfortunate weakness in the region.
2). Apple Inc. (NASDAQ:AAPL)’s paltry market share could be viewed as a massive opportunity in the world’s most populous country.
With a rumored lower-cost iPhone on the horizon, the latter is the wiser approach. The same glass-half-full approach in analyzing the Apple’s opportunity in China Mobile Ltd. (ADR) (NYSE:CHL) will lead investors to a similar conclusion: the opportunity is massive.
China Mobile boasts 744.9 million wireless subscribers. Peers China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) and China Telecom Corporation Limited (ADR) (NYSE:CHA), together, don’t even add up to half of China Mobile’s subscriber base.
Even more, just about 20% of China Mobile Ltd. (ADR) (NYSE:CHL)’s subscribers are 3G subscribers while China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) and China Telecom Corporation Limited (ADR) (NYSE:CHA) have a 3G penetration rates of 39% and 52%, respectively. 80% of China Mobile’s 744.9 million subscribers aren’t on 3G — that’s a huge market of potential first-time smartphone upgrades.
Could it be?
If there were any monumental moment for Apple to finally make an arrangement with China Mobile Ltd. (ADR) (NYSE:CHL), this would be the time to make it happen. Apple’s first lower-cost iPhone could help the company make inroads in the important Chinese smartphone market.
According to data from Canalys, Apple’s share of shipments in China in the most recent quarter was a paltry 4.8%. Apple would undoubtedly like to tap into this massive opportunity.
The grape vine over at Reuters said in August that the talks between Apple and China Mobile Ltd. (ADR) (NYSE:CHL) were looking good. Maybe a China Mobile deal is the underlying premise behind this Beijing Apple media event.