Apple Inc. (AAPL) iPhone 5C Pricing Not Positive For Chinese Operators

Apple Inc. (AAPL) iPhone 5C Pricing Not Positive For Chinese Operators
ElisaRiva / Pixabay

Apple Inc. (NASDAQ:AAPL) unveiled iPhone 5C and iPhone 5S at the September 10th event, and both phones will be available in stores from September 20th in Australia, Canada, China, France, Germany, Japan, Singapore, the U.K. and the U.S. Among all countries, China has been included for the first time in the initial launch list. However, analyst Jin Yoon from Nomura feels the iPhone 5C may not get very popular in China, owing to higher pricing.Apple Inc. (AAPL) iPhone 5C Pricing Not Positive For Chinese Operators

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 Pricing slightly too high in China

 In China, the price for the iPhone 5C has been kept at CNY4,488/5,288 for 16GB/32GB, while for 5S the price is CNY5 288/6,088/6,888 for 16GB/32GB/64GB respectively. A report from The Wall Street Journal quoted that Apple plans to ship less-expensive iPhones to China Mobile, which indicates that Apple Inc. (NASDAQ:AAPL) will collaborate with China Mobile to sell cheaper iPhone models.

 Analyst Jin Yoon thinks that including China in the first launch list is a positive surprise against the expectation of a delay in the launch for the country. However, pricing of iPhone 5C in China is a bit too high, selling at only CNY800 less than iPhone 5S model.  This pricing will not drive Chinese consumers towards Apple Inc. (NASDAQ:AAPL) as they can get Xiaomi or other local mobiles in China for less than half of the price of iPhone.

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 iPhone 5C pricing not positive for operators

 It is highly unlikely that iPhone 5C will be able to gain turf in the mid- to low-end market in China, where 80 percent of incremental 3G smartphone sales come with a price tag of CNY2,500.  There is no official word from both the companies over a probable China mobile and Apple Inc. (NASDAQ:AAPL) deal, and thus analysts expect that network carriers will offer significant subsidies to boost sales in China. Nomura analysts expected a much lower price from Apple to bring down the subsidies and to support network carriers.

According to analysts, “overall pricing of the iPhone 5C is certainly not a positive for operators.”

 Apple iPhone 5C available for pre-orders

 The iPhone 5C in now available for pre-orders in the listed countries. The off contract price is $549 for 16GB and $649 for 32 GB, in the U.S. Pre-orders can be made through Apple Inc. (NASDAQ:AAPL) stores or via the carriers AT&T Inc. (NYSE:T), Sprint, T-Mobile, and Verizon Communications Inc. (NYSE:VZ). Customers in other listed countries apart from China can place their pre-orders via the Apple Store or through their local network operators. China’s inclusion in the initial launch list is a significant development indicating Apple’s commitment to the country.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at
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