SAN FRANCISCO -- It's a sign of the current investment malaise that a news article with "iPhone" and "China" in the same headline does little to keep traders from favoring the sell button.

Two years ago, as we were all enjoying the


surge past 2,500 (it's now 1,100 points lower), any suggestion that a company had broken down the door to bring its services and products to the world's largest population was enough to have shareholders dreaming of immediately doubling revenue and profit.

Such is the downside to the global part of the global slowdown.

On Monday, the Web site reported that


(AAPL) - Get Report

had reached an agreement with

China Unicom

(CHU) - Get Report

to introduce the iPhone 3G device into the Chinese market as early as this May.

The announcement, which hasn't been confirmed by either company, comes after a plethora of reports over the past several months that Apple and

China Mobile

(CHL) - Get Report

had been trying -- and failing -- to come to a revenue-sharing agreement that would bring the iPhone to the Asian country.

As we recently noted, the iPhone is Apple's

only growth product

at the moment -- and probably for the foreseeable future.

Most analysts are now expecting the company's Mac computer sales to fall year over year in its March quarter, while the company's iPod music device could see unit sales falling by as much as 8%, according to some estimates.

On Tuesday, Calyon Securities analyst Shebly Seyrafi cut his rating on the stock, as well as his profit estimates for this and the next current fiscal year. He pointed to the trouble that he expects Apple to have amid the decline in PC demand that is seeing a huge move by consumers toward so-called netbooks -- low-fi notebook computers that are cheaper.

That's not a great match for Apple and its premium-priced offerings.

What's even worse is that companies that choose to start offering netbooks, as Apple is rumored to be considering, risk the cannibalization of their notebook lines. Morgan Stanley analyst Kathryn Huberty, in cutting her forecast on PC industry for this year

and next year

on Tuesday, said she expects a 10% cannibalization rate of traditional notebooks (meaning, consumers would buy 10% fewer notebooks), and believes netbooks will comprise 20% of notebook sales this year, up from 8% last year.

But Calyon's Seyrafi also trimmed his expectations for March-quarter iPhone unit sales to 3 million devices from 3.2 million devices, citing both his own supply checks and the ever-crowding smartphone market, which witnessed 28 new models unveiled recently at the World Mobile Congress in Barcelona.

For Apple, however, 3 million iPhones sold in its current second quarter would still represent growth of more than 75% over the company's year-ago period.

That means the iPhone's role as Apple's chief driver of revenue growth should continue for several quarters to come, and that the company's pricing strategies and consumers' willingness to spend during that timeframe will determine the degree of growth -- and how soon Apple shares will get back above $100 and beyond. (The shares were recently up 3.7% to $90.15).

So, what do we know about China? As asset manager Jim Welsh recently pointed out, we know that 1) exports from Japan and South Korea to China plummeted in December by 36% and 35%, respectively; 2) electric utility use -- a measure of industry -- is down 8% year over year; and 3) estimates say 20 million to 25 million migrant workers are now without a job there.

This is the backdrop to a possible announcement by Apple this spring that it is moving into China. The company's shareholders may want to put their faith in a more tangible contributor to growth.