After all, Samsung -- armed with a broad range of smartphones at various price points -- appears to have been sucked into the brutal price competition with China’s local smartphone vendors, thus ending up having to fight the battle on all fronts.
Meanwhile, Apple, thus far, has managed to stay above the fray by sticking to a higher price tag for its products than for those of its rivals.
The question, then, comes down to the following: For Chinese consumers who can afford the high-end smartphones, how much would it be worth, or would it mean, to own genuine Apple iPhones?
Apple, as a brand, still commands a high respect in China. And, let’s not forget, affluent Chinese consumers are very brand-conscious.
But here’s the thing: Chinese local brands are also taking a page from Apple’s playbook.
Xiaomi, in particular, is intent on building its own brand, and has become quite successful in building a cult-like community full of die-hard Xiaomi fans. Xiaomi is no knock-off iPhone vendor. The company has taken pride in offering its products with high-end specifications at low prices.
Xiaomi’s latest flagship smartphone, the Mi4, unveiled earlier this week, looks much like Apple’s similarly metallic iPhone 5s. The Mi4, however, is priced at 1,999 yuan (US$322) -- less than half of the US rival’s handset.
Xiaomi mi4, priced at 1,999 yuan, features a 5-inch 1080p screen, 2.5GHz quad-core Snapdragon 801 SoC, 3GB of RAM, 16GB/64GB of internal storage, 13MP f/1.8 main camera, 8MP selfie camera, LTE radio, 802.11ac WiFi, plus a 3,080mAh battery.
Although Apple's continued success in China is by no means guaranteed, Apple remains confident that the best is yet to come. The company noted that its agreement with China Mobile -- reached in January this year -- has been only activated for the last couple of weeks. Cook said during the call:
We’ve been selling with China Mobile now for about a week, and last week was the best week for activations we’ve ever had in China. So it’s been an incredible start, and at this moment, we’re just selling in 16 cities with China Mobile, and this number is projected to be over 300 cities by the end of this year. And so we’ve got quite the ramp in front of us, and we’re incredibly excited. This comes after a new high water mark in China for us last quarter.
— Junko Yoshida, Chief International Correspondent, EE Times