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The iPhone 5c’s Weaker Than Expected Sales May be the Holdup in Apple/China Mobile Talks

The iPhone 5c’s Weaker Than Expected Sales May be the Holdup in Apple/China Mobile Talks

“Weak sales” of Apple’s iPhone 5c may be the issue holding up the finalization of a deal between Apple and the world’s largest wireless provider, China Mobile.



Sales of Apple’s less-expensive iPhone 5c may be holding up an anticipated China Mobile deal, says KGI analyst Ming-Chi Kuo, but negotiations are likely nearing an end point.

Kuo believes the much-anticipated partnership will result in shipments of 15 to 20 million iPhone units shipped in 2014. He expects that to jump to 20 to 30 million the following year. Kuo does note that actual numbers will depend on Apple’s strategies in midrange and low-end devices.

“We believe that weak sales of iPhone 5C may trigger a re-negotiation of the Apple-China Mobile partnership,” Kuo writes. “However, the indications are that the deal is nearing an end. While recent market speculation calls for the deal to boost 1Q14 iPhone shipments to 45-50mn units, we think this is overly optimistic.”

The analyst’s latest information shows that demand for a TD-LTE China Mobile compatible version of the iPhone 5c has dropped dramatically in recent weeks. Chinese subscribers are more focused on the high-end iPhone 5s.

Thus, Kuo expects TD-LTE iPhone 5c shipments to be around 1.0 to 1.5 million units in Q4 of 2013, and under one million for Q1 of 2014. It is believed this may be a sticking point in Apple/China Mobile negotiations.

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