Do­mes­tic ri­vals make most of fall­ing Ap­ple

China Daily (Hong Kong) - - COMMENT - Zhang Zhoux­i­ang The au­thor is a writer with China Daily. zhangzhoux­i­ang@ chi­nadaily.com.cn

Tim Cook, the chief ex­ec­u­tive of­fi­cer of Ap­ple Inc, launched three new prod­ucts — iPhone8, iPhone8 Plus and iPhoneX — on Tues­day but, un­like in the past, the Chi­nese mar­ket’s re­sponse at best was luke­warm.

To­day Ap­ple ranks fifth in the Chi­nese smart­phone mar­ket. Worse, in the sec­ond quar­ter of this year, only 8 mil­lion iPhones were sold on the Chi­nese main­land, drag­ging its mar­ket share from 9.2 per­cent in the first quar­ter down to 7.1 per­cent. And among the top five best-sell­ing smart­phones, iPhone is the only one to see its mar­ket share drop.

Ac­cord­ing to an on­line sur­vey, about 37 per­cent of the iPhone users and 49 per­cent users of other brands said they would not buy any of the three new prod­ucts af­ter watch­ing their launch. Es­tab­lished brands such as iPhones have lost their shine be­cause “in­no­va­tive” new prod­ucts no longer catch the fancy of many youths.

South Korea-based Sam­sung faces an even big­ger chal­lenge. The launch of its new prod­uct on the same day at­tracted so lit­tle at­ten­tion from Chi­nese con­sumers that there were hardly any re­ports about the event on Chi­nese web­sites.

Among other things, per­haps Ap­ple’s at­ti­tude to­ward Chi­nese users and com­pa­nies is re­spon­si­ble for its de­cline in the Chi­nese mar­ket. It has al­ways had a big ap­petite for profit, even try­ing to make money from the apps loaded on the iPhones. For in­stance, in April, Ap­ple asked Ten­cent, the owner of WeChat, to pay 30 per­cent of all the bonus money as a kind of “tax”. That Ap­ple has fallen be­hind in the fierce com­pe­ti­tion for iPhones’ outer de­signs, per­for­mances and prices has also con­trib­uted to its de­cline.

From iPhone4 in 2010 to iPhone8 this year, Ap­ple has stuck to the same de­sign pat­tern. In par­tic­u­lar, iPhone8 looks al­most the same as iPhone7, prompt­ing many to say that iPhone8 users should keep their “new buy” up­side down on the ta­ble so that those around can see the glass back and re­al­ize it is the new model.

The de­cline of big global brands has seen a cor­re­spond­ing rise in the for­tunes of Chi­nese smart­phone com­pa­nies, which have up­graded their mod­els sev­eral times in the past years.

MI, a do­mes­tic smart­phone com­pany, was founded in April 2010, but its share in the Chi­nese mar­ket in the sec­ond quar­ter was 11.8 per­cent, higher than that of iPhones.

Be­sides, both MI and Huawei have en­tered the US mar­ket and are com­pet­ing with Ap­ple in its home­land and Europe. In­spired by the strat­egy of “Made in China 2025”, the Chi­nese cell­phone com­pa­nies are catch­ing up fast by in­vest­ing huge amounts of money in re­search and de­vel­op­ment. For in­stance, thanks to its ro­bust R&D in­vest­ment, Huawei topped the in­no­va­tion list last year with 4,906 patents.

In other words, the chang­ing cell­phone mar­ket re­flects the in­creas­ing po­ten­tial of Chi­nese mo­bile phone pro­duc­ers.

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