Apple's shares soared $16.2 on Nasdaq, closing at $169.96 with a 10.54% increase due to the news that China Mobile may introduce iPhone into China. The rise not only stopped the four-day consecutive fall but also created the largest increase in more than one year.
China Mobile's CEO Wang Jianzou said yesterday that he is negotiating with Apple Inc. on how to bring the iPhone to China, although no agreement has been reached yet. Wang revealed during the GSMA Mobile Communications Asia Conference held in Macau that there are disagreements between the two companies regarding revenue distribution.
If an agreement is reached between the two companies, it would mean that Apple could influence 523 million users, which is even more than the total population of the EU. Tiffany Feng, an analyst at Guotai Junan Securities in Hong Kong, believed that the entry of the iPhone into China will be a great boost for Apple. The iPhone was first launched in the United States in June and combines the functions of an iPod media player and a mobile phone.
The Apple iPhone smartphone features music downloads and internet browsing capabilities, which can help China Mobile attract high-income users. Previously, China Mobile had reached an agreement with RIM to jointly sell BlackBerry phones. Wang Jianzou stated yesterday in Macau that China Mobile's users love such fashionable products, but the biggest problem is the business model.
Regarding this, Jill Tan, Apple's female spokesperson in Hong Kong, refused to comment and only mentioned that the company plans to sell iPhones in Asia next year.
Apple has signed cooperation agreements with operators in the US, UK, Germany, and France, sharing user deposit income with them. Analysts estimate that AT&T, Apple's exclusive partner in the US, pays Apple $10-20 per user per month, while AT&T's monthly subscription fee ranges from $60 to $220. Last month, the iPhone entered the UK and Germany, and it will enter France this month.
Feng from Guotai Junan Securities believed that China Mobile might limit the number of iPhones. The motivation for China Mobile to sell iPhones and BlackBerrys is the same - to make users consume more.