iPhone Gets Slow Start at China Sales Launch

After much anticipation, the launch of the official iPhone in China wasn’t met with the overwhelming demand that has greeted the launch elsewhere, partly because the handset is being sold without key features, like wifi access. From PC World:

High prices may also have kept away buyers. Chinese shoppers can find cracked gray-market iPhones for around 4,000 yuan (US$587) at many local electronics markets, while the cheapest iPhone being sold by China Unicom costs 4,999 yuan with no service contract.

China Unicom is selling the 32GB iPhone 3GS with no contract for the equivalent of $1,026, compared to about $800 in nearby Hong Kong.

Apple removed Wi-Fi from the iPhone for China to comply with the country’s regulatory demands, another strike against the phone compared to gray-market versions.

The Wall Street Journal blog gives details of the exorbitant prices being charged to Chinese iPhone users:

We wrote about the price issue in today’s Journal, but here’s a more detailed breakdown of what prospective Chinese iPhone buyers are looking at: China Unicom is offering three models of the iPhone. Without being bundled with a service package, the phones will go for 4,999 yuan ($732, for the 8-gigabyte iPhone 3G), 5,880 yuan ($861, 16-gigabyte 3GS), and 6,999 yuan ($1,025, 32-gigabyte 3GS). China Unicom is offering 8 levels of third-generation wireless service packages, ranging from 126 yuan ($18) a month to 886 yuan ($130) a month, which will allow users to download data at higher speeds and run applications like streaming video.

To get a subsidy on the iPhone, users can pay a deposit, which will be returned incrementally each month in the form of a deduction on the users’ monthly bill. The higher the service plan and the more the user leaves for a deposit, the less they pay for the Unicom iPhone.

For the 32-gigabyte model on Unicom’s most expensive data plan, that translates to paying over 21,000 yuan ($3,076) over two years for phone and service. In contrast, U.S. users buying the same model with AT&T’s most expensive plan will pay $2,600 over two years (plus tax). In Hong Kong, people pay about $1,300 through Hutchison Telecom for a similar package. So iPhone users in the U.S. and Hong Kong pay less for iPhones – and their devices include Wi-Fi wireless Internet capability, which Unicom said its iPhone won’t have.


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