Plans to introduce the
iPhone to China have
been derailed by a breakdown in negotiations, local press reports say.
Apple and
China
Mobile, the country's largest mobile operator, both want a larger share of
revenue than the other is prepared to give, according to reports on
Sina.com.
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Apple had been discussing a Chinese debut for the iPhone with China Mobile
for several months, and had demanded 20 to 30 per cent of revenue earned from
iPhone subscribers.
However, Gao NianShu, general manager of China Mobile's mobile data division,
insisted that this was not acceptable.
"We definitely do not agree," he said. "It is not that we want to control the
value chain, but that we think the value chain should be jointly established and
developed."
Although this is the second time that negotiations between the two companies
have broken down, Gao insisted that China Mobile is prepared to reopen
negotiations if Apple is willing.
Gao also criticised the iPhone's mobile messaging functions, which he said
are much weaker than its internet capabilities. He described this deficit as
typical of an IT company entering the communications market.
The easy availability of expensive grey-market iPhones in China's larger
cities suggests that there is considerable demand for the product.
Government-linked China Mobile dominates the country's mobile market with
almost 370 million subscribers.
Tight government control of mobile operator licences means that China Mobile
has only a single, much smaller competitor, China Unicom, which has
approximately 120 million subscribers.
The government is expected to grant mobile network licences to two additio
nal operators when it belatedly allows 3G services to begin operating later this
year.
A Hong Kong-based spokeswoman for China Mobile confirmed to
Bloomberg
News that the two companies were no longer talking, but did not give any
additional information.
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