Apple (NASDAQ:AAPL) struck a long-sought deal with China Mobile for the world's largest carrier by subscribers to carry its iPhones, according to a Wall Street Journal report, which could give Apple a major boost in the world's biggest smartphone market.
The report, citing unnamed sources familiar with the matter, said that the iPhone launch is expected to start later this month, around the time of a Dec. 18 China Mobile event. Previous Chinese media reports have pegged Dec. 18 as a launch date for China Mobile's TD-LTE service.
At the Dec. 18 event, China Mobile is expected to announce a brand for its TD-LTE service and China Mobile executives have said they would only begin to sell the iPhone after introducing such service. On Wednesday, China's Ministry of Industry and Information Technology issued licenses for the TD-LTE standard to the country's three carriers, China Mobile, China Telecom and China Unicom.
China Telecom and China Unicom already carry the iPhone, and many analysts have said that a lack of support from China Mobile is holding Apple's market share down in China, giving openings to rivals such as Samsung Electronics, and Chinese firms Lenovo, Huawei, ZTE and Coolpad. China Mobile, with around 740 million subscribers, is one of the last major carriers not carrying the iPhone. Greater China, including Hong Kong and Taiwan, is Apple's third largest market after the U.S. and Europe in terms of revenue, according to the Journal.
Apple declined to comment, according to the report.
China Mobile has the largest lead among its rivals in building out its TD-LTE network, which is expected to reach 100 cities covering 500 million people this year. In September, China's Telecom Equipment Certification Center revealed that Apple received what is known as a "network access license" for a handset resembling the iPhone that runs on the mobile standards used by China Mobile for 3G and TD-LTE networks. Apple's iPhone 5c model A1529 and iPhone 5s model A1530 both support TD-LTE in Bands 38, 39 and 40 (2.6 GHz, 1900 MHz and 2.3 GHz, respectively). Those are the bands China Mobile has authorized for its TD-LTE network thus far.
The two companies have been in talks over the iPhone for several years but Apple did not want to make a variant solely for China Mobile's TD-SCDMA 3G network. Presumably, China Mobile's move to TD-LTE helped seal the deal. Additionally, China Mobile had pushed back against Apple's insistence on sales volume guarantees.
Research firm Trefis said China Mobile could sell about 1.5 million iPhones per month, which would mean almost 20 million additional iPhone activations for Apple in 2014, according to the Journal.
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