Apple’s progress in China threatened by big screens demand

Apple Inc. is currently facing a real challenge while trying to boost its share on the Chinese market by selling handsets through China Mobile Ltd. starting Friday. The companys difficulties come from the fact that a large number of Chinese customers prefer purchasing large-screen devices in order to check their e-mails, browse the Internet, watch videos or play games. Every other fourth-generation smartphone offered by China Mobile is at least half an inch larger than the screens of the models offered by Apple.

Bryan Wang, who is principal analyst and country manager in Forrest Research Inc., said :China is driving the demand for large-screen devices.” Mr. Wang explained that about 40% of all devices using the Android operating system sold this year through Chinese carriers will have screens measuring at least 5 inches.

Duncan Clark – the Chairman of BDA China Ltd., which is an advisor company, explained that currently Samsung is recognized as the biggest Android phones manufacturer and offers a diversity of phones at various prices. Mr Clark believes that Samsung has managed to win the lead in China thanks to the fact it realized how important the interest towards large-screen devices are earlier than other competitive companies. He commented on Apple: “A model with a bigger screen is key to take on Samsung. Just look at the popularity on the Note and other models with much bigger screens.”

According to Canalys, Samsungs third-quarter shipments in China lead on Apples ones with 15%. Samsung ranked first with 21% of smartphone shipments on the Chinese market, and Apple ranked fifth with only 6%. China Mobile revealed that the pre-orders for Apples iPhone have reached about 1 million units. The two companies officially announced a multiyear agreement after a meeting in Beijing on January the 15th between the Chairman of China Mobile – Xi Guohua and the Chief executive Officer of Apple – Tim Cook.

Benjamin Bollin, who is an analyst working for Cleveland Research, said in a note on January the 14th that Apple may introduce two larger-screen iPhone devices by the end of 2014. The Apples spokeswoman in Beijing – Carolyn Wu, refused to make any comments on the companys future plans concerning the release of a larger device.

According to CNN Money, the current share price of Apple Inc. is 2.01% up, and its one-year return rate is 0.65% down. The 46 analysts offering 12-month price forecasts for Apple Inc. have a median target of 600.00, with a high estimate of 777.00 and a low estimate of 360.00. The median estimate represents a +7.65% increase from the last price of 557.36.