Apple to bypass China Mobile by selling iPhone through third-party retailer?

Wednesday, September 2, 2009 16:20

china unicom iphone 1 Apple to bypass China Mobile by selling iPhone through third party retailer? Apple (NSDQ: AAPL) has already locked down China Unicom as their Chinese iPhone partner and is still trying to strike a deal to bring the iPhone to China Mobile (NYSE: CHL)’s massive 500-million-strong customer base. But, China Mobile recently launched OPhone smartrphone operating system and their own mobile applications store which compete directly with the iPhone OS and the iPhone AppStore, respectively. That puts a kink in Apple’s plans to bring the iPhone to the world’s largest wireless carrier. So what’s Apple going to do? A new report from Wedge Partners research analyst Matt Mathison speculates that Apple could partner up with Chinese cellphone retailer Di Xing Tong to sell iPhones. These iPhones could be unlocked to work on China Mobile’s network.

Mathison says that Apple could push the iPhone through Di Xing Tong’s hundreds of storefronts throughout China, helping increase iPhone penetration in the massive Chinese market. He believes that Apple would sell the iPhones with the understanding that they could be unlocked to work on China Mobile’s network – Apple won’t sell unlocked iPhones directly, they just won’t prevent customers from unlocking them.

The Di Xing Tong retail chain is owned by Foxconn, Apple’s iPhone manufacturer. The retailer’s close ties to Apple could help facilitate an iPhone distribution deal.

There’s a problem though. China Mobile’s 3G network is incompatible with the iPhone. That would leave any would-be Chinese iPhone unlocker limited to China Unicom’s 3G network or China Mobile’s 2G GSM network. The Chinese iPhone doesn’t feature WiFi, so China Mobile’s 2G network might be a tough pill to swallow.

[Via: BusinessWeek]

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