iPhone is closer to China Mobile, world’s largest network

Apple is very close to reach an agreement with China Mobile, world’s largest cellular network with over 700 million customers. The deal would allow iPhone onto the network, something Apple has been trying to do for a long time. According to Forbes, China Mobile has a model of an iPhone that works on the network and the device has already been approved by the Chinese authorities. That eliminates all barriers between Apple and China Mobile and the only thing that could prevent the deal is the financial aspects that need to be negotiated.

The reason for iPhone not to be available for the China Mobile customers is technical. iPhone doesn’t have a TD-SCDMA chip that is required by the carrier to get onto the mobile network. Now, Apple has got an approval to make changes and include this chip, so iPhone can finally arrive at the largest carrier in the world. According to engineers, the current iPhone 5c chip needs some minor fiddling in order to handle TD-SCSMA.

So, the question when the iPhone will be available for China mobile customers is a matter of financial agreement. As we know, Apple has some special requirements regarding the marketing efforts from the carriers. The carriers need to make significant marketing expenses and subsidies to customers.  The subsidies are per each unit sold and they can reach hundreds of $ per item. By pressure, Apple lowers the prices of its products and they are sold for less, while the carriers cover the price reduction. This politics, however, faced some fierce reaction in a number of countries. In Russia for example, the major carriers have stopped offering iPhone, that resulted in a very low market share for Apple.

Source: Forbes