Apple CEO Tim Cook in China, visited with China Telecom, possibly to talk about declining iPhone sales, say local reports.— Michael Kan (@Michael_Kan) July 30, 2013Presently, China Telecom and China Unicom (CHU - Get Report) are the only carriers in China that have access to the iPhone. The world's largest carrier, China Mobile (CHL) does not have an official deal with Apple although there are reports of as many as 10 million iPhones on the China Mobile network. It's unclear if Cook has met with China Unicom and China Mobile during the visit, though the Apple chief has met with China Mobile in the past, to discuss "matters of cooperation." China has become an increasingly important area for Apple, as it seeks to expand iPhone access to as many customers as possible. However, revenue for Greater China in Apple's fiscal third quarter fell to $4.64 billion, down from $8.21 billion in the prior quarter, and $5.39 billion in the year-ago period. On Apple's recent earnings call, Cook noted that some accounting and inventory factors weighed on China, but it wasn't clear what exactly happened. He noted that sell-through in China (which includes Hong Kong) was down 4% year over year, with Hong Kong down a lot, but mainland China actually up 5% year over year. That growth rate is lower than Apple's accustomed to, with Cook noting it could be attributed to "many things, including the economy there. "Hong Kong is an international shopping haven as you know for not only tourist but also some resellers and we saw more dramatic downturn there," he said. "It's not totally clear exactly what had occurred but it was down on a sell through basis by about 20% so that weighed greater China down as you can see in your data sheet." Perhaps some of the issue can be attributed to price, though it's not clear if that's the sole reason. IDC recently noted that companies like LG, ZTE and Lenovo gained market share, specifically citing strength in Asia/Pacific for ZTE as a reason. Apple's iPhone is comparatively much more expensive than other handsets from the aforementioned hardware manufacturers.
Apple Wants Another Bite Out of China
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