Apple may be poised to take over the wireless subscriber masses of China, but not many there can afford an iPhone.
The Mac maker late October introduced the nation of some 710 million mobile subscribers to its sleek phone, but its reception has since been underwhelming. That's in part because the price tag on the gadget nears the level of a working class Chinese salary--yearly salary. An iPhone 3GS with 32GB of memory there costs about $1,168 without a service contract -- the way most Chinese buy phones -- nearing the $1,290 average yearly salary in China. For Apple, that means the market is far smaller than such a big nation suggests.
"Our analysis of income levels and current Chinese subscriber metrics suggests that the total market for high-end smartphones is likely less than 15 million," Pacific Crest Securities analyst Andy Hargreaves wrote in a report Tuesday.
The analyst said the firm expects the market for smart phones in China over the next few years to remain relatively small. It doesn't help that it's even a stretch for the average income of the upper 10 percent in China, who earn about $7,000 per year.
And that's not even considering the price of a service plan. Apple can forget about people paying premium pricing for mobile service.
"Fewer than 10 million subscribers pay more than $30 per month for wireless service," wrote Mr. Hargreaves.
Pacific Crest makes a market in Apple stock.