Apple’s iPad Growing More Popular With Young People In China

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Apple's iPad Growing More Popular With Young People In China

Apple Inc. (NASDAQ:AAPL) dominated the iPad market in China with 72.6 percent market share during the three-month period ending in July, based on the Digitimes survey. Samsung (Korea SE :005930), which is considered the strongest competitor of the company, landed fourth place with only a 3.59 percent market share in the country.

Lenovo Group Limited (PINK:LNVGY) landed second placed with an 8.39 market share, Eben Tablet ranked third with 3.63 percent, while Acer iPad took the 5th place, with 3.27 percent.

Based on the survey, three out of four consumers in China purchased Apple iPad, despite the fact that the product was only introduced in July 20.  AppleInsider cited the result of a study conducted by Analysys International, a research in firm in China, that the total number of tablets purchased by Chinese consumers was 2.34 million during the second quarter of the fiscal year. The result was 63 percent higher than the total tablets purchased in the country last year.

Based on the data, Apple Inc. (NASDAQ:AAPL) sold approximately 1.7 million tablets in China during the three-month period ending in July this year, while Samsung only sold around 84,000 tablets. If Apple’s iPad was introduced earlier during the quarter, most likely the company’s market share would have been greater. The launching of the product was delayed, due to the trademark complaint filed by Proview Technology. The Chinese firm agreed to settle the iPad trademark dispute for $60 million.

The Apple Inc. (NASDAQ:AAPL) iPad is popular among young people in China. During the second quarter of 2012, the Chinese market contributed $5.7 billion revenue to Apple’s earnings during the second quarter of the fiscal year. China is the company’s second largest market.

Meanwhile, China Labor Watch, a labor rights group in the country, criticized Apple’s iPhone and iPad manufacturing partners, particularly Foxconn Technology Co., Ltd. (TPE:2354), for imposing long working hours and a military like culture for its workers. Based on the investigation conducted by the labor rights group, employees worked 180 hours overtime per month during peak periods, which is a violation of the 36 hours overtime limit every month.

In response to the criticisms and investigation by the labor rights group, Apple audited the labor situations of workers of its manufacturing partners and found the same result. The company implemented the Supplier Responsibility Program to address the labor issues. In its 2012 progress report, the company said 229 supply chains were audited, and in response, designed training programs and educated more than 1 million supply chain workers about local laws, labor rights, occupational health and safety, and the Apple Supplier Code of Conduct.

On the other hand, HTC’s Corp (TPE:2498) smartphone devices, particularly its Desire V Series, are becoming more competitive in China.  Jessica Kwee, analyst from Canalys Research, observed that HTC Corp (TPE:2498)’s shipments in the country grew by 389 percent. According to her, the company’s strategy in introducing devices tailored to the needs of Chinese consumers provides an edge in growing awareness for its products. Kwee said, “Among the international vendors, only HTC Corp (TPE:2498) managed an outstanding performance in mainland China. Its success this quarter is heavily based on the strong performance of the Desire V series devices, designed with the local China market in mind.”

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