Apple Inc. (NASDAQ:AAPL) may have already signed a deal with China Mobile, and there’s no doubt that the addition of the carrier will do great things for the company. But what many don’t realize is that Apple already has 42 million iPhone users on China Mobile Ltd. (NYSE:CHL) (HKG:941)’s network. This could be either good or bad for Apple, depending on the reactions of the carrier’s subscribers.
Apple subscribers already on China Mobile
The original post on this topic was on the Chinese site Sina Tech, and the first to spot it was Unwired View. Apple Inc. (NASDAQ:AAPL)’s big problem with China Mobile has been the carrier’s 3G network, which operates on TD-SCDMA technology. Apple just couldn’t support that technology because it isn’t used on any other carriers throughout the world.
So why are there 42 million iPhone users already on China Mobile Ltd. (NYSE:CHL) (HKG:941)’s network if apple’s phone isn’t compatible with its 3G network? They’re actually using it on the carrier’s older 2G – GPRS / EDGE network.
What a deal with China Mobile means for Apple
So if China Mobile users are already buying Apple Inc. (NASDAQ:AAPL)’s iPhones for use on outdated technology, the question would be how many more of them would buy the handsets for use with the latest technology. With more than 740 million subscribers, Apple has a significant chance to greatly grow its user base by simply adding China Mobile to its carriers.
We heard recently that Apple’s new iPhones have been cleared by a key Chinese regulator to run on China Mobile’s TD-LTE standard, which means that when the carrier rolls out 4G technology, Apple will be in business on the network. Chinese regulators are expected to begin issuing 4G licenses to the nation’s carriers by the end of this year. China Mobile Ltd. (NYSE:CHL) (HKG:941) could get its 4G license as early as November and then start rolling out its 4G network not long after that.
Apple still faces potential complications
Of course there is still a chance that many of China Mobile’s current iPhone users won’t want to buy a new phone just to upgrade to 3G. This might be why we haven’t heard anything official from Apple Inc. (NASDAQ:AAPL) or China Mobile regarding a deal between the two companies. They could be waiting until the announcement of the 4G rollout, which might coax some 2G iPhone users to upgrade to 4G speeds.
So it remains to be seen if China Mobile can help Apple reverse its falling numbers in mainland China. The tepid reception the pricey iPhone 5C received in China might not bode well for Apple. A report just last week issued the results of a survey of young professionals in Beijing, most of whom said they would be dropping the iPhone and upgrading to the Samsung Galaxy instead.