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iPhone X success, but Apple China market share is declining

According to foreign media reports, Apple’s variety of iPhone products launched in late 2017 made its market share in China’s smart phone market increased. In spite of this, the share of Apple’s mobile phone in China’s smart phone market will fall in 2018 due to the declining consumer demand, the reduction of mobile operator subsidies and the fierce competition from Huawei and other domestic Chinese smart phone brands.

In China’s smart phone market, consumers have many local brands of smart phones in their hands, while smartphones such as Apple are considered as a status symbol. Apple’s new iPhone product, introduced in late 2017, has increased its market share in China’s smartphone market.

According to relevant reports, Apple’s fourth quarter in the Chinese smartphone market share of 24.3%, while benefiting from the iPhone 8, iPhone 8 Plus and iPhone X three smart phones to promote the role of Apple’s share of the global smart phone market Reached a record 51%.

However, analysts believe Apple’s share of China’s smart phone market will gradually decline in the coming year. They said Android smartphones such as Huawei and Xiaomi will regain some of their market share. Industry analysts believe Chinese mobile operators are also cutting back on subsidies for handset makers as interest in new devices is declining in the smartphone market.

“We expect 2018 to be a difficult year for Apple’s iPhone smartphone in China, given the slowdown in the overall smart phone market, reduced operator subsidies and increasingly localized competition.” Strategy Analytics, the market research firm, is responsible Neil Mawston, executive director of wireless equipment, said.

Sales decrease

Canalys, a market research firm, said in January that Chinese consumers generally had fewer new purchases of smartphones. China is currently the world’s largest smartphone market with shipments of 459 million units, down 4% YoY in 2017. Market research firm IDC estimates that China’s smart phone market dropped 4.9% last year and is expected to decline another 2% this year.

IDC said in a statement released on February 6 that Chinese consumers think the change in handset technology in 2017 will be “insignificant.” Kiranjeet Kaur, head of market research at the company, said most people are switching to smartphones in 2016, replacing devices in their hand with devices that have more features, such as a bigger screen, a fingerprint reader and a new camera Features. He also added that the high price is also to some extent, limiting the sales of Apple mobile phones.

Operator subsidies decrease

The continued decline of mobile operator subsidies will push consumers to buy Apple mobile phone spending, which may further affect the sales of Apple mobile phones.

According to a report from Market Realist, an investment research site, the Chinese government has demanded that domestic telecoms operators reduce their marketing costs by 20%, a reduction that will include subsidies for smartphones. The report said the lower smartphone subsidies “have the most impact on Apple because the iPhone sales increase is heavily dependent on subsidies.”

China Daily reported that subsidies for the sale of iPhone handsets began in 2014, while major mobile operators, including China Mobile, China Telecom and China Unicom, will reduce sales subsidies for Apple’s handsets.

Local competitors

Analysts believe that Apple iPhone X up to 1,200 US dollars from the price of Chinese consumers daunting. Despite the increasing amount of wealth held in hand, many shoppers are still very concerned about the purchase budget. And China’s native Android smart phone brands are aware of this. Over the past five years, the low selling prices of these Andriod smartphone makers in China and other emerging markets helped boost their market share.

“For example, Huawei has been plowing the Chinese market for many years and its operations have achieved quite high returns,” said Eddie Han, industry analyst at Taipei Institute of Market Intelligence and Consulting. “It is likely that Huawei will continue to consolidate its presence in China’s smart phone market Position. ”

Han added that Chinese brands Oppo and Vivo “did a great job” in expanding sales to tier-two and tier-three cities, while millet “vowed to regain the Chinese market.”

Market research firm IDC said the fourth quarter of last year, four Chinese smartphone maker brands accounted for the top four in the domestic market share. Which Huawei’s market share of 24.3%, Oppo accounted for 20%. Vivo and millet occupy the third largest market share in the market.

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US refurbished machine craze hit Samsung Apple

In 2017, Apple and Samsung Electronics launched a wave of product prices, high-end mobile phone prices almost equal to 1000 US dollars, the media questioned whether such a high price can be consumer acceptance.

According to foreign media latest news, Samsung and Apple’s high price policy is producing some negative effects, including high-end mobile phone market in the United States, more and more consumers to buy refurbished machines, a mobile phone history as many as 34 users, which Affected Samsung Apple’s new handset sales.

According to an authoritative financial media in the United States, more consumers in the United States choose to buy refurbished machines for older cell phones or use their old cell phones for longer, and they will not choose to buy expensive new phones.

In the past, refurbished mobile phones were only popular products in countries in Asia, Africa and Latin America. In the United States and other countries, in the past, carriers’ mobile phone subsidy system was implemented. After the expiration of the two-year contract, operators or handset manufacturers will have a large number of old mobile phones in hand and handset manufacturers will conduct official refurbishment to replace the parts or the shell and ensure that mobile phones Continue to be available, in addition to provide a new warranty policy. These refurbished handsets are being sold to countries in Asia, Africa and Latin America that have less spending power.

Earlier, Apple also plans to sell official refurbished machines in India, as the price of new iPhone products in the Indian market is more than $ 1,000, far exceeding the national consumption power. However, the government of India rejected Apple’s proposal to sell refurbished machines that would damage the rights and interests of Indian consumers and affect the handset manufacturing and cell phone brands in India.

It is reported that North American refurbished machines have also emerged in a popular trend. The auction website B-Stock told the media that in five years ago, the United States accounted for only about half of the phones auctioned by the company, but its share has now risen to 93%.

Statistics show that nearly 10% of smartphones sold in the world are refurbished machines. In this way, refurbished handsets have become the fastest growing segment of the smartphone market.

Statistics from various agencies showed that for the first time in the global smart phone market last year, the annual decline was witnessed. About a 10% sharp drop occurred in the Chinese market. Many second and third tier brands are withdrawing from the mobile phone market. In the US mobile phone market, sales have lost momentum, but no major downside.

In addition to refurbished machines boom, other factors that affect consumers to buy a new phone also includes the US carrier to cancel the subsidy system. In the past, the subsidy for many high-end handsets was only $ 199, putting almost no pressure on consumers.

But nowadays, consumers need the full price to buy high-end phones from Samsung and Apple. Although handset makers and operators generally provide installments (for example, they can be paid in installments in two years or three years), the $ 1,000 price is still a burden (the average monthly salary for Americans is $ 4,000, and a handset is equivalent to One week’s salary).

According to the analysis, the mobile phone market innovation degree of decline, manufacturers make up for the upgrade mode, which also affected the consumer interest in buying a new cell phone.

It is reported that the current US consumer use of a cell phone cycle has increased by 8 months compared with 2013, extended to 31 months, next year will be extended to 33 months.

Last year, Apple Inc. introduced the iPhone X to commemorate the tenth anniversary of entering the mobile phone market, but various data show that the phone sales are bad. In the case of the release of three mobile phones, Apple’s mobile phone sales in the fourth quarter of last year, once again fell into the quagmire of decline.

Nikkei News reported that Apple has half the iPhone X production plan in the first quarter to 20 million. Affected by the iPhone X, Samsung Display Company was also forced to reduce the OLED screen production Liu Cheng, iPhone X also hit parts suppliers in Taiwan.

Although the iPhone X increased the average selling price of Apple’s mobile phones, but its sales weakness, the high price of $ 1,000 to Apple has had some negative effects.

Among the new handsets released this year, whether Apple will learn the lesson and reduce the retail price of high-end handsets is noteworthy.