China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) (HKG:0762) just announced over 100,000 reservations have been made for the iPhone 5S and iPhone 5C. It’s been less than a week since Apple Inc. (NASDAQ:AAPL) unveiled their new smartphone to the public. Even though this carrier has yet to share pricing information on the new phones, pre-orders are still very strong. Because of this, analysts predict subsidies will decrease for these new models.
China Unicom and China Telecom price competiton
Cynthia Meng (analyst from Jefferies) explained, “China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) (HKG:0762) and China Telecom Corporation Limited (ADR) (NYSE:CHA) (HKG:0728) are more rational on price competition, balancing between quantity and quality of new 3G subscriber development. “
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Sun Hung Kai Financial Ltd analyst Eva Yip added, “The plan is more conservative this time. The handset subsidy as a percentage of upfront payment is less than that of the iPhone 5 plan.”
China Telecom offers the iPhone 5S for a down payment of 5,288 yuan and the 16-gigabyte iPhone 5C for 4,488 yuan. Customers can also get the new phones for free under a two-year contract. The 5C goes for a minimum monthly plan of 329 yuan and the 5S starts at 389 yuan.
iPhone 5S and iPhone 5C launch date
China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) (HKG:0762) and China Telecom Corporation Limited (ADR) (NYSE:CHA) (HKG:0728) will launch both new phones in stores on September 20th. This will be the first time that the iPhone will be available to 1.4 billion Chinese consumers. China Mobile also made a deal to access 740 million customers, which has yet to be announced.
It’s looking good for Apple Inc. (NASDAQ:AAPL), who has been trying to make a significant impact in the Chinese market. The fact that China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) (HKG:0762) has already received over 100,000 reservations for both new phones within a week of the unveiling speaks volumes. Apple Inc. (NASDAQ:AAPL) understood China’s desire for low-priced smartphones, and they delivered. These numbers should help push Apple Inc. (NASDAQ:AAPL) back in the lead and help them reclaim their crown from Android-based competitors like Samsung. Now that the Cupertino tech giant has released a budget phone, it’s time for the competition to really begin.