iPhone 11 Launch Timing, Cuts Drive Apple's Uncertain China Rebound 2020, Apple managed to report a decline in China's revenue largely due to iPhone 11's release-timing, a cheaper version, and a bit of good luck in the September quarter, but analysts said the company's good fortune could be short-lived.
Apple said sales in China declined 2.4 percent in the fourth quarter ended September 30, a far cry from a 27 percent drop in the first quarter of this year - a fact that chief executive Tim Cook was on call for after the company's earnings Play on Wednesday.
The company has priced the cheapest variant of its iPhone 11 at $ 50 (about Rs 3,500) less than the previous generation model,
even drawing it in the launch of the new model a month vs. last year, which led to sales in the September quarter got help. .
A year after heavy discounts on older iPhone models, Apple allowed resellers to cut prices, contrary to previous practice. Also, the company recently introduced an installment-based payment plan to further drive sales in a weak economy and a contracted smartphone market.
James Yan, who oversees China's smartphone market at Counterpoint Research, said "Apple's new low-cost strategy in China had a huge impact."
But the company hopes to launch only 5G-enabled smartphones next year, which analysts say is a problem when China's top smartphone maker Huawei launched its first 5G phone in June - the Mate 20X, The price of which was CNY 6,199 (GBP 681). Or about Rs 62,400).
Small phonemakers, including Xiaomi, have quickly followed suit as China's state-owned carrier prepares to launch 5G services on Friday, effectively bringing ultra-fast web connectivity to the public.
Yan is hoping for cheaper 5G devices from these companies due to market flooding in China next year, which will reduce Apple's sales.
According to market research firm Canalys, Huawei closed the lion's share of the Chinese market, causing Apple to go down the heap.
The September quarter was actually an improvement for Apple in China.
Service revenue - which the company is touting as the iPhone driver to grow as the iPhone volume plateau -
grew by double digits in China as more iPhone users download games on the App Store, after regulators released the games after a one-month ban Approval continued.
Chinese authorities approved 291 domestic and imported titles for in-app purchases in July – September,
downloading popular titles including Pro Evolution Soccer from Havens and NetEase through the Battle of Tencent.
Nicole Peng, who tracks China's smartphone industry in canals, said that Apple's revenue growth of services is also evidence of the fact that Chinese consumers are more habitual to pay for online content.
"Even on Android and WeChat, users require too much content to pay membership or subscription fees," she said.
Peng also said that an option to trade in older models was featured more prominently on Apple's China website this year and retail employees are stepping up service to customers.
In the past, faced with a business-choice, "Chinese consumers will ask, 'Why would I want to trade in my phone? Are you saying I don't have enough money to buy it?" "he said.
But domestic resellers such as Aihuishu, Huishoubao and Alibaba's used goods site Jianyu have helped consumers who switched to cheap Android phones understand that an iPhone's price might be offset.
iPhone 11 Launch Timing
Apple said sales in China declined 2.4 percent in the fourth quarter ended September 30, a far cry from a 27 percent drop in the first quarter of this year - a fact that chief executive Tim Cook was on call for after the company's earnings Play on Wednesday.
The confluence of things helped.
The company has priced the cheapest variant of its iPhone 11 at $ 50 (about Rs 3,500) less than the previous generation model,
even drawing it in the launch of the new model a month vs. last year, which led to sales in the September quarter got help. .
A year after heavy discounts on older iPhone models, Apple allowed resellers to cut prices, contrary to previous practice. Also, the company recently introduced an installment-based payment plan to further drive sales in a weak economy and a contracted smartphone market.
James Yan, who oversees China's smartphone market at Counterpoint Research, said "Apple's new low-cost strategy in China had a huge impact."
But the company hopes to launch only 5G-enabled smartphones next year, which analysts say is a problem when China's top smartphone maker Huawei launched its first 5G phone in June - the Mate 20X, The price of which was CNY 6,199 (GBP 681). Or about Rs 62,400).
Small phonemakers, including Xiaomi, have quickly followed suit as China's state-owned carrier prepares to launch 5G services on Friday, effectively bringing ultra-fast web connectivity to the public.
Yan is hoping for cheaper 5G devices from these companies due to market flooding in China next year, which will reduce Apple's sales.
According to market research firm Canalys, Huawei closed the lion's share of the Chinese market, causing Apple to go down the heap.
Time matters
The September quarter was actually an improvement for Apple in China.
Service revenue - which the company is touting as the iPhone driver to grow as the iPhone volume plateau -
grew by double digits in China as more iPhone users download games on the App Store, after regulators released the games after a one-month ban Approval continued.
Chinese authorities approved 291 domestic and imported titles for in-app purchases in July – September,
downloading popular titles including Pro Evolution Soccer from Havens and NetEase through the Battle of Tencent.
Nicole Peng, who tracks China's smartphone industry in canals, said that Apple's revenue growth of services is also evidence of the fact that Chinese consumers are more habitual to pay for online content.
"Even on Android and WeChat, users require too much content to pay membership or subscription fees," she said.
Peng also said that an option to trade in older models was featured more prominently on Apple's China website this year and retail employees are stepping up service to customers.
In the past, faced with a business-choice, "Chinese consumers will ask, 'Why would I want to trade in my phone? Are you saying I don't have enough money to buy it?" "he said.
But domestic resellers such as Aihuishu, Huishoubao and Alibaba's used goods site Jianyu have helped consumers who switched to cheap Android phones understand that an iPhone's price might be offset.
iPhone 11 Launch Timing, Cuts Drive Apple's Uncertain China Rebound 2020
Reviewed by Codest BD
on
November 06, 2019
Rating:
Reviewed by Codest BD
on
November 06, 2019
Rating:
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