yonkshi 11 days ago

Currently visiting China for Chinese New Year, and can't help but to notice the anti-US anti-Apple sentiment that arose recently. Although anecdotal, I think the nationalistic sentiment has a lot to do with the dip in sales.

To put in perspective, most Chinese netizens are generally pretty critical of the Chinese gov. Chinese with higher educations usually look up to western culture and products. However after the Huawei arrest incident, the Chinese netizens were pissed at the American government, I've never seen such anger towards the US gov, and huge waves of boycotts began. They think that American gov is bullying a Chinese company into obeying US law even outside US, and their response is to boycott American products.

During my two weeks here I've talked to a dozen random people at bars, friends gatherings and on the plane. Normally US-China politics never come up, but it has come up in almost every single conversation this trip. Most of these people mention that they recent switched to a Chinese phone or their next phone will be a domestic phone.

  • free652 11 days ago

    For some reason I doubt that you have the right perspective. Chinese are very nationalistic and every non immigrant Chinese I met is pro Chinese government. Netcitizens are even worse.

    American are persecuting a company that disobeyed American laws on American soil. No a single Chinese would blink an eye about persecuting American companies in China.

    China is having economic issues, that's the major reason in sales' dip.

    • ardy42 11 days ago

      > American are persecuting a company that disobeyed American laws on American soil. No a single Chinese would blink an eye about persecuting American companies in China.

      Hypocrites exist. The Chinese government was shamelessly hypocritical over the Meng arrest, complaining that it violated her "human rights," [1] while their utter indifference to them has yet again been made clear by the camps in Xinjiang. I doubt everyday nationalistic citizens would be any more thoughtful.

      [1] https://www.bbc.com/news/business-46465768: "A Chinese foreign ministry spokesperson told reporters: 'The detention without giving any reason violates a person's human rights.' ... Beijing has itself frequently been accused by rights groups of rights abuses including unexplained detentions"

      > China is having economic issues, that's the major reason in sales' dip.

      Nationalistic ferver drummed up by the Huawei arrest could compound the sales drop.

      • dethac 10 days ago

        So... because China violates the rights of Chinese citizens, the US deserves to violate the rights of Chinese citizens?

        It goes both ways. I'm sure we'd all prefer if everyone would just stop violating human rights, but that isn't happening. It's not fair to ignore the US's human rights violations just because of China's, and it's not fair to ignore China's human rights violations just because of the US's. Both governments are hypocritical.

      • roboys 11 days ago

        Camps in Xinjiang have a lot to do with an anti-terrorism effort. Out of the 10 distinct Muslim ethnic groups in China, only one, the Uyghurs, are being put in camps for anti-radicalization efforts due the terrorist activities they engaged in over the last 2+ decades (running over people with cars, attacking businesses & government buildings).

        Secondly, the Iran sanctions are illegal and most European countries are still doing business with Iran and not being penalized for it by the US. This is pure tradewar leverage/thuggery at work.

        Get ready for "yellow peril" style propaganda (anyone find the SuperMicro spychips yet? I thought we were riddled with them) to make a comeback as China's economy becomes more of a threat to US hegemony.

        • steve19 10 days ago

          Putting a million people into re-education camps is simply terrible. There is no justification for it.

          • roboys 10 days ago

            You are right, re-education camps to de-radicalize are bad but they are objectively better than our method of killing 1+ million civilians in Iraq/Afghanistan in the name of anti-terrorism then leaving a vacuum for ISIS to continue the mayhem and destabilize the whole region.

            • tivert 10 days ago

              > re-education camps to de-radicalize

              That's bullshit. The camps aren't there to "de-radicalize" anyone, they're there to subjugate and destroy a minority culture.

              This is proven because this government campaign also targets "moderates" of that culture, even ones that have gone out of their way to declare loyalty to the state:

              https://www.nytimes.com/2019/01/05/world/asia/china-xinjiang...

              > Last year, Mr. Jalaleddin joined a government-led campaign for prominent Uighurs to write open letters declaring their allegiance to the state.

              > Despite that declaration, he was detained in January 2018 [emphasis mine], according to overseas Uighur organizations.

              > “So many moderate intellectuals have been detained now,” Dr. Harris said. “I don’t know how else to understand this, except as a deliberate policy to deprive Uyghurs of their cultural memory.”

            • flyingpenguin 10 days ago

              Are they objectively better? I have a hard time seeing either as better than the other, just horrifying in their own unique ways.

        • mcphage 10 days ago

          > Get ready for "yellow peril" style propaganda (anyone find the SuperMicro spychips yet? I thought we were riddled with them) to make a comeback as China's economy becomes more of a threat to US hegemony.

          I read that Bloomberg article as more of a swipe at Apple and Amazon than at SuperMicro—especially given the tenor of other articles they've posted, as well as the fact that both companies responded forcefully almost immediately, with no followup or rebuttal from Bloomberg.

          • roboys 10 days ago

            You should see what happened to Supermicro's (SMCI) marketcap during those fake reports, the swipe didn't affect AAPL & AMZN's stock price near as much, if at all.

        • sydli 10 days ago

          It's an anti-separatist crackdown that can be compared to China's similar crackdown on Tibet. In fact, the top official (Chen QuanGuo) who ran and experimented with surveillance technology and forced assimilation in Tibet was transferred to Xinjiang in 2017 to essentially build up and run the same type of program, in less time, and for a much larger region (in both area and population). Hence, the camps.

          In no way is any of it justified-- it's millions of people, and even the Uyghurs that escape are being continually hunted by the government.

    • ksec 11 days ago

      The boycott of American products is very real. What we do not know is how large the impact really are. For example Hermes posted a record quarter in China again, doesn't seems to be hurt by whatever downturn there is in China.

      • stephencanon 11 days ago

        Hermès is French.

        • newnewpdro 11 days ago

          One would expect them to suffer in China as well if the cause were economic, which I believe is the point the parent is making.

          • stephencanon 11 days ago

            That’s a reasonable interpretation, thanks. I’m not sure that it tells us much given that Apple and Hermès are in fairly different markets, unfortunately.

            • lern_too_spel 11 days ago

              They're both in the luxury fashion market in China.

              • stephencanon 10 days ago

                The population of people who can justify a $1k scarf is a small portion of the population who can justify $1k for the object they use for almost everything, even in China.

                • lern_too_spel 10 days ago

                  You can buy a scarf that works just as well for much less, and you can buy a phone that works better for Chinese consumers for much less. The reason to buy an iPhone or a Hermès scarf for a Chinese consumer is fashion.

              • sonnyblarney 10 days ago

                Apple is not quite a luxury good. Hermes is. They are definitely in different categories.

    • roboys 11 days ago

      China's economy has less to do with iPhone sales decline than the fact that Apple's smartphone innovation has plateaued. There is no "must-have" feature in the current gen iPhone that requires an upgrade, especially not for $1200+. The jig is up.

      Expect AAPL to decline from now on unless they pivot or get some balls and use that stockpiled cash to experiment heavily. Tim Cook is not willing to burn cash on R &D like he needs to maintain a major competitive edge.

    • iguy 11 days ago

      Agree that sounds like the leading factor.

      There is a line of thinking that the trade war comes at a convenient time PR-wise for the Chinese got. It gives them a scapegoat for domestic economic issues, which they are only too happy to talk up. (But I don't really know anything, and welcome expert correction.)

  • jjcc 10 days ago

    I totally agree with your observation. I've been there in last Dec and this Jan. Probably the hostile sentiment is even stronger towards Canada (Which traditionally most Chinese see as a friendly country partially because of a couple of famous Canadian who are almost unknown to Canadian themselves.) than US. Since I'm Chinese Canadian, the topic was always brought up during dinner/lunch with friends.

    However I'm not sure if the boycott really has a big impact on sales. The consumers quite pragmatic when they spend their own hard-earned money even the sentiment is really strong as you observed. In China there are cut-throat competitions across all markets. Mobile phone market is one of them. There are quite a few smartphone manufacturers fighting for market share. Some used-to-be-good companies could not survive but the news only limited in China. Without boycott Apple sales still could go down because of competition.

  • dis-sys 11 days ago

    > Chinese with higher educations usually look up to western culture and products.

    this was probably true 10-15 years ago. rather than some cheap talks purely based on "what I heard" or "what I believe", let's have some quick concrete numbers published [1] by the top Chinese university Tsinghua. In its 2018 annual graduate report, the summary table on page 2 shows that for the total 6,960 students graduated in 2018, 16.5% chose to pursue further studies overseas, while 28.5% chose to continue in Chinese universities for a higher degree.

    the most shocking number comes from the table 6 on page 9 - out of the top 25 employers of the 2018 graduates there is only 1 foreign company (Microsoft).

    I checked the same reports from the previous few years, the trend is the same.

    [1] http://career.tsinghua.edu.cn/publish/career/8155/2018122915...

    • Wowfunhappy 10 days ago

      > In its 2018 annual graduate report, the summary table on page 2 shows that for the total 6,960 students graduated in 2018, 16.5% chose to pursue further studies overseas, while 28.5% chose to continue in Chinese universities for a higher degree.

      I wouldn't expect this to correlate with opinions of "western culture and products". There are a whole lot of reasons why you'd choose to stray in your country vs going oversees. For instance, how easy is it to get a US visa vs just staying in your native country?

      • dis-sys 10 days ago

        > There are a whole lot of reasons why you'd choose to stray in your country vs going oversees. For instance, how easy is it to get a US visa vs just staying in your native country?

        there is only one western company in the top 25 top employers list, is that related to US visas?

  • ataturk 11 days ago

    Yes, but how much of that incident is just propaganda? I mean, Huawei is rigging all their electronics with spy technology. The only reason the US is mad is because our NSA wants to do that to us and they're worried about Huawei equipment finding its way into the DoD. But let's be honest--we're all being spied on 24/7 now. It's time to start pushing back against this technological terror. I demand honest government, not this slipshod, coercive, East German nonsense. It sucks and we don't even know how we got here so fast--it was like one minute everything was fine and the next, we've got "Big Brother" in everything! And worse, people seem to be clamoring for more Big Brother.

    This will end in mass murder. People you love will be murdered by the government you love. Make. It. Stop.

potatofarmer45 11 days ago

I think what a lot of commentators are missing is that even without a trade war, IPhone shipments would have fallen in China.

In the past, the android phones kept focussing on features (remember the s3 ads about how it had all these features missing in the 4/4s). Now, especially with Huawei, they've really mastered the art of branding and messaging on their products. When Huawei listed a phone with 3 cameras and cost more than an iphone, I knew that was a home run. The higher price reinforced the image of the premiumness of Huawei which benefitted all their products down the line as evidenced by their sales numbers. They've finally realized the Xiaomi (same quality at a lower price), actually doesn't work on an emotional level with consumers. Instead, Huawei have gone to the extreme (Leica partnership lenses + 3 cameras). They've been doing this for a while, and results just take time to show and now they have.

  • JohnJamesRambo 11 days ago

    What do the 3 cameras do?

    • ninedays 11 days ago

      It doesn't really matter as long as it creates a sense of uniqueness for the consumer. Remember all these octo-cores smartphones that were supposed to perform way better than the two-cores smartphones? It's only there to tell you "3 cameras are better than 2" even though no one understands what it does. Same with cores : "wow 8 cores? 8 is such a big number compared to 2 cores therefore it must be way better/faster"

      • dvfjsdhgfv 11 days ago

        May or may not be the case.

        > “When I first heard that Huawei’s new flagship device was going to have three rear-facing cameras I was sceptical,” said Ben Wood, chief of research at CCS Insight. “But it feels like the company has added meaningful features rather than gimmicks, including the five-times telephoto zoom, excellent low light, long exposure performance and crisp black and white pictures the dedicated monochrome lens offers.”

        https://www.theguardian.com/technology/2018/mar/27/huawei-p2...

        > Huawei’s traditional setup of combining the data from a monochrome and a color sensor is still in place, but this time, the color sensor weighs in at a whopping 40 megapixels. You’ll have the option to use that entire resolution to take photos, though the default setting will be to combine the data from four adjacent pixels into one and thus generate clearer, brighter 10-megapixel shots. One of these quad-pixel pixels inside the P20 Pro measures in at 2µm, which is huge for a smartphone sensor. Google’s Pixel 2, for comparison, has 1.4µm pixels, while the regular P20, which has a 12-megapixel main sensor, comes with 1.55µm pixels.

        https://www.theverge.com/2018/3/27/17165822/huawei-p20-pro-s...

        • baybal2 11 days ago

          I have Maimang 5 - a budget phone from almost 4 years ago. Despite it budgetness, it still came with the best camera chip on the market at the time, and with far from budget parts, aside from SoC. And it was never advertised on those points.

    • addicted 11 days ago

      Make it seem that literally the only feature regular phone users upgrade for is a lot better on the Huawei.

    • SiVal 11 days ago

      Correct me if I'm wrong, but I believe this means three "lenses" on the main camera, not three cameras. And I'm excited to see what future cameras with multiple lenses, synthetic aperture techniques, and lots of computation will provide.

    • mtgx 11 days ago

      3x optical zoom. And I think each have different characteristics like one is normal, one is wide-angle and one is telephoto.

    • baybal2 11 days ago

      Supposedly better than 2 cameras, but not as good as 5 or 7 cameras.

      Still, you can proudly tell people "my phone has more cameras than yours" :)

      • Haga 11 days ago

        My phone finds others nearby photographing and recombines those willing into one giant parallax camera.. Beat that

ksec 11 days ago

Roger McNamee seems to get it, the iPhone was probably the most successful technology product in history, and arguably the "most" successful in anything. It leads to a sea of other innovation across multiple spectrum.

On the Notes of Retail, Apple had ~430 Stores in 2014, ~460 in 2015. As of end 2018 it is ~510, all the stores opened in 2015 were planned before Angela's arrival, so effectively she has slowed down the opening of new Apple Store under her tenure. During that time, Apple grew from ~800M Active Devices to 1.4B, that is 600M Devices increase, but less than 60 new Stores opened, if you are wondering why it is so crowed you cant even breath in Apple Store, that is why.

In 2015 I made a prediction that Apple could be aiming at 1B iPhone users by 2020. It seems crazy at the time, and a lot of people did call me so. But as of 2019 Apple has 900M iPhone users, so the 1B iPhone users doesn't seems to far off. I also thought Apple should be aiming at 1000 Apple Stores world wide. Apple Retail were growing at approximately 10+% before 2015, it was possible to reach ~750 by 2020, now not only have they not accelerated, they slowed down.

From reading all the latest Interview, it finally seems to me this luxury Apple idea didn't came from Angela herself. It came from Tim Cook ( or may be even Jonny Ive ), he wanted Apple to be more luxurious ( Apple Watch Gold Edition in 2016 ), and get Angela on board to try and help shaping the Retail part. Angela never wanted the job in the first place, but Tim Cook talked her into it. And one reason why her salary package were the highest in Apple.

I hope having Deirdre O'Brien meant Tim Cook gave up this idea of luxurious Apple. At least not luxurious in the normal sense, Apple is an affordable luxury in tech world, and that is drastically different to clothing or Jewelry industry. iPhone needs After sales services, and you cant rely on a small number of Apple store to provide adequate services to its customers and loyal users.

  • kettlecorn 11 days ago

    Apple is not just chasing luxury, they’re chasing tech as fashion.

    They realized that when people carry their tech with them all the time it becomes fashion. That’s why they bought Beats, because it became a huge tech-fashion brand that threatened Apple.

    And with fashion people are willing to pay much higher prices.

    • TheOtherHobbes 11 days ago

      Which was not a clever idea, because Apple already owned the tech-as-fashion brand just by being themselves.

      In fact the fashion market is all about ridiculous virtue signalling at absolutely ridiculous prices - like the Vertu range, which takes an average phone and wraps it in some leather and chrome bling, dresses up the marketing copy with "craftsmanship" "exclusive" etc etc etc and charges five figures for it.

      The key point is ridiculous pricing. Not just the very high end of affordable, like Apple. But the kind of ridiculous that only works for the 0.1%.

      So Apple was never going to be Gucci-of-tech, or LV, or H. Or even Vertu. Because Apple is never going to charge $20k for its main iPhone range. And unless it does, it can't be a serious fashion brand.

      In fact Apple's strong point was always its appeal to the exclusivity of the creative market - talent, intelligence, inventiveness, and art. It's a completely different exclusivity - more accessible but also sexier - than the mass market appeal of the expensive-but-trying-too-hard mid-market brands that Apple has ended up in.

      Cook has done an excellent job of destroying that creative entrepreneurial foundation. This has made a lot of money for Apple in the medium term, but at the cost of the good will and loyalty of its core fans.

      That won't seem like a problem if you're a bean counter, but it's a huge vulnerability for the brand. It means Apple has shaved off more and more of its USP, and now it's vulnerable to imitators in some of its key territories.

    • brandonmenc 11 days ago

      ugh, the old "Apple is trendy/fashionable" argument.

      Apple is like Nike.

      Fashion and design are elevated as first-class concerns along - and rarely conflicting - with functionality and ubiquity. Yes, they cost more than the bargain basement, but actually span a wide range of price, otherwise they'd be as rare and exclusive as Hermès bags - yet everyone seems to have an iPhone, just like everyone seems to have a pair of Nikes.

      Apple is not "chasing tech as fashion" - they make holistic products that a very small segment of the population perceives strictly as "trendy fashion." Millionaires wear Nikes to fashion shows, and your dad mows the lawn in Nikes.

    • rchaud 11 days ago

      They haven't done anything with Beats though aside from rebranding the streaming service as Apple Music.

      I rarely see Beats headphones out in the wild, and they used to be very common 5-6 years ago. Airpods are more common now as a status symbol.

ancorevard 11 days ago

China's economy is looking scary at this point.

Also from Bloomberg: Chinese consumer tax receipts down 70% in November. https://www.bloomberg.com/opinion/articles/2018-12-31/china-...

  • adventured 11 days ago

    The corporate bond defaults [1] are also interesting as a tell on their real situation. I'll be curious to see if the central government relents and unleashes a far larger stimulus as it appears there isn't going to be a trade deal near-term.

    Granted, you've also got Germany in a de facto recession and the UK inching toward one [2]. If the US can maintain a 2.5%+ GDP growth pace for 2019 against all of that, it'll be surprising. Projections on S&P 500 Q1 earnings have turned from 6-7% growth to an expected contraction. The market will weaken further with earnings growth disappearing, which is guaranteed to force the Fed to pause rate hikes and then cut.

    [1] https://www.bloomberg.com/news/articles/2019-02-11/two-large...

    [2] https://www.bloomberg.com/news/articles/2019-02-11/u-k-econo...

    • paganel 11 days ago

      > Granted, you've also got Germany in a de facto recession

      Added to that, Deutsche Bank's recent "funding woes" (to quote the FT) personally give me a bad vibe, not sure if we're at the "summer 2007 phase" of Northern Rock's troubles [2] or if we're already in the "early September 2008 phase", i.e. a couple of weeks before Lehman fell. The nastier news is that, afaik, Deutsche is (was?) seen as being supported by the German government (the same as Volkswagen, for example), even more than the Wall Street investment banks were supported by Washington, and if Deutsche falls that will reflect very, very badly on the perceived financial soundness of the German government and hence of Europe as a whole.

      [1] https://www.ft.com/content/cb739552-2c5d-11e9-8744-e7016697f...

      [2] http://news.bbc.co.uk/2/hi/business/6996136.stm

robk 11 days ago

If you look at market share though it seems to actually be holding solid or growing [1]. This makes me believe a more neutral narrative that it's due to people upgrading from lousy low end android to higher end android much faster than an existing iPhone user would upgrade. The top 25% of the population use iPhones and aren't leaving the Apple platform - the folks who bought a low end phone are upgrading to higher end much more rapidly. [1] https://www.statista.com/statistics/262176/market-share-held...

  • oblio 11 days ago

    It's Windows vs Mac all over again, people just wouldn't believe it :)

    1 company vs 100. All the 100 companies would have to be knuckleheads forever (which is super unlikely, it's basically: "you can fool some people all the time or all the people sometimes, but you can't really fool all the people all the time").

    Android is moving up in the world, and except for the US, which was always a bit weird in regards to Apple, Android will make Windows' dominance look like a walk in the park. Look at what Google's doing with relatively weaker dominance of Chrome in the web browser world.

    • scarface74 11 days ago

      Windows vs Mac is a very shallow interpretation.

      -the affluence level of iOS users dwarf Android users statistically. A person who can afford a $700 iPhone is much more valuable than a person buying a $220 Android phone (the average selling price of an Android phone)

      - Apple couldn’t keep up performance wise with the Mac because you had the entire PC industry funding Intel. Hardly anyone is making money selling Android phones. Apple is making 80% of the profit in the phone market.

      -iOS is doing well in most affluent countries

      https://deviceatlas.com/blog/android-v-ios-market-share

      • oblio 11 days ago

        My personal opinion is that the future of technology isn't in the current affluent countries. Besides this, we already know that the vast majority of people stay within their ecosystems, once they start using them. Especially know that the differences in phone quality are going down (cheap phones are getting good; a cheap Android phone from 2010 was miles away from an iPhone, a cheap Android phone from 2020 will be comparatively much, much closer).

        So the future isn't looking very bright for Apple, considering that India, China and Africa are almost entirely Android territories :)

        Just keep in mind that Windows failed for 10+ years before having the smash hit that was Windows 95.

        • scarface74 11 days ago

          Windows “failed” but the whole time Microsoft was making a killing selling DOS. Microsoft, Intel, and the PC manufactures were all making money. The PC market drove a demand for high performing chips and even when PCs were being commoditized, there was enough of a demand for high end processors to keep Intel’s R&D effort strong. The high end profitable niche of the Android market is teeny. It’s eveb worse in the tablet market and the wearable market.

          Not even Google is making any real money on Android. It came out during the Oracle trial that Android has only made Google $39 billion during its entire existence. Even then, they pay Apple over $2 billion a year to be the default search engine for iOS devices. Mobile hasn’t been that great for anyone in the Android ecosystem.

          Android as a whole is nothing more than unprofitable race to the bottom.

          What use it to sell to 3 billion people buying $50 phones? If Apple starts losing the high end, then it needs to worry.

          Even in the PC market, none of the PC manufacturers are rolling in cash - except for Apple. I wouldn’t be surprised if Apple makes more selling Macs than all PC manufacturers make selling computers (excluding servers).

          On a second thought, the biggest users of servers are probably cloud companies and Facebook and many of them are making their own servers.

          • orangecat 11 days ago

            It came out during the Oracle trial that Android has only made Google $39 billion during its entire existence. Even then, they pay Apple over $2 billion a year to be the default search engine for iOS devices.

            If Android didn't exist, Google would likely be paying even more to be the default search engine on non-iOS devices, or they'd have significantly lower search revenue.

puranjay 11 days ago

Now that China profits have dried up, Apple will turn its attention to India.

But they've really missed a trick with their retail strategy in India. They've partnered with local retailers to run "Apple stores". These stores are nowhere near the smooth, beautiful experience of a regular Apple Store.

It feels preposterous to walk into a shoddily built store selling a phone for $1200 when you can walk next door to a Samsung or OnePlus outlet and get a similarly capable phone for half the price

Apple needs to bump up its quality game. They've been losing market share here in India and for all purposes, this country is a lost cause to them. I wouldn't be a very happy Apple shareholder right now

  • bwb 11 days ago

    isn't that because of local laws they can't open stores directly? India has a ton of weird rules and super regulated.

    • puranjay 11 days ago

      Yeah, but lots of foreign retailers team up with more competent partners who operate their brand stores. Gucci, Armani, and Versace can't operate directly in India either, but you wouldn't know it looking at their stores.

      Apple's Indian partners don't seem to care, nor does Apple that their partners are offering a sub-par experience.

  • hajile 11 days ago

    I somewhat doubt India is a good target for them. Even FirefoxOS feature phones currently outsell Apple in India right now.

    • puranjay 11 days ago

      India's premium smartphone market is small, of course, but it is also growing, and it is also a market where Apple has lost massive market share.

      And let's be honest, anyone who can see even 10 years into the future would know that the next wave of growth will come from India

    • dingo_bat 11 days ago

      Apple has really absurd pricing in India. I plan to spend around $1000 in ₹ to upgrade my phone in the coming months. But if I buy an iPhone I'll get the absolute lowest version of last year's model.

  • oblio 11 days ago

    I doubt they can out-compete Chinese brands in India. Those are starting to dig in and they are also closer to the price-sensitive Indian market in philosophy.

  • mcphage 10 days ago

    > for all purposes, this country is a lost cause to them

    It's not really a lost cause until the market is saturated. If the smartphone market in 5-10 years in India is going to be significantly larger than it is now, then it's just getting started.

  • glenrivard 11 days ago

    Apple has been trying in India for years without any success.

    Their share has actually decreased over the last year.

GeekyBear 11 days ago

It seems peculiar for stories to continue to ignore the economic situation inside China as a major cause for Apple's sales woes inside China, especially given the number of companies not named Apple that have also reported plunging sales there.

We've had reports of a worsening job market and reduced consumer spending inside China since last year.

>DONGGUAN, China — China’s consumers and businesses are losing confidence. Car sales have plunged. The housing market is stumbling. Some factories are letting workers off for the big Lunar New Year holiday two months early.

https://www.nytimes.com/2018/12/14/business/china-economy-xi...

  • dmix 10 days ago

    The first bullet in their sub-headline does say:

    > IPhone’s high price tag is a major reason for the contraction

    That combined with lower consumer confidence could easily be the most obvious reason. With a small amount of nationalistic propaganda/marketing thrown in.

    The other big elephant in the room is WeChat becoming the primary Chinese mobile OS, diminishing the value of Android vs iOS. Which puts further pressure on the price of the phones, as they are more commodity-like. Apple raising prices, particularly in China, at this time might end up being the worst business idea they've made in a long time.

    • GeekyBear 10 days ago

      If Bloomberg's theory were true and the price of Apple's devices was the major issue here (and not the Chinese economy) then we would expect to see similar sales drops outside of China, and we have not.

      Also, we wouldn't expect to see falling sales in China across all of the device manufacturers (even those selling budget devices) inside China as shown in even this article.

      The reality is that the major factor here is that Chinese consumers are cutting way back on spending due to economic uncertainty inside China.

      It's something that has been discussed in the media since last year.

nakodari 11 days ago

iPhones have become just too expensive for people in Asia to buy. It's simple as that. If they bring down the price to $599 like it was for the original iPhone and keep the price constant every year, Apple will double or even triple their existing market share. It will still be profitable for Apple knowing that service revenue will increase when more people are using iPhones around the world.

  • r00fus 10 days ago

    How do they do this while keeping profit margins on non-Asia countries high?

    That's the rub. XR was supposed to be the Asia phone with dual-sim and sacrificing OLED to get a bigger phablet.

    Instead we have "which X to choose" dilemma.

    • dethac 10 days ago

      Apple has, with the iPhone, ignored region-locked devices.

      By doing so, they're effectively sacrificing a massive portion of the Asian market. Oh well.

  • baybal2 11 days ago

    No, the simple explanation for their sales tanking is simply because they got their market saturated. Plainly and simple.

    Huawei on other hand has rather different marketing plan - they make somewhat expensive products for ordinary people, even thought some of their phones can cost more than $1000 USD in maxed out configuration (leather and hand made editions)

    Apple on another hand has really little appeal to this demographic, on both brand identity front, and product match.

    That surely sounds unusual to a Western person, but that how it is. Huawei buyer is a well off working man in late twenties or early thirties with few more things to care about in his life than his phone.

    Car analogy: Huawei - a nice full size sedan, a show of success for a common man; Apple - an "economy supercar" like Black Badge edition RR Ghost, something what broke millionaire wannabees buy

    • philliphaydon 11 days ago

      No. The price of iPhones in Asia is FAR to expensive now. A lot of people in Asia are jumping ship because they can get the same features for less with other brands. Even with a contract in Singapore it would cost me $1000 to get the latest iphone. That’s insane.

    • Synaesthesia 11 days ago

      Within China, Apple doesn't compete on price. Yes Huawei has expensive phones, but for example you can buy a Mate 20 Pro for $650 there whereas an iPhone XS costs $1,270 for the entry level model.

      https://www.gizmochina.com/2018/10/26/huawei-mate-20-and-mat...

      • baybal2 11 days ago

        > iPhone XS costs $1,270 for the entry level model.

        Indeed, but they also have the "3rd world iPhone" models - respins of previous generations and "C" model which were to supposedly cater to this market.

        They greatly overestimated willingness of locals into buying "poor man's Rolce Royce editions"

        • pjmlp 11 days ago

          Who would buy a previous generation iPhone when they can buy a modern Android generation phone for the half the price?

          • scarface74 11 days ago

            A “modern generation” Android phone that is half the price of an iPhone would be much slower. The 6s from 2015 was faster than the flagship Galaxy S8 in single core performance.

            Also, that Android phone you buy will stop getting updates in 18 months if you’re lucky. The iPhone 5s from 2013 is still running the latest OS.

            • rchaud 11 days ago

              > A “modern generation” Android phone that is half the price of an iPhone would be much slower.

              Slower in doing what? Posting a pic/video on Wechat? Making a money transfer? Playing a game?

              Phones today are where the PC market was about a decade ago when 4GB RAM and a Core 2 Duo SoCs became common and offered enough performance for users to not have to upgrade their laptop every 3-5 years.

              We don't have to look at AnandTech-style benchmark analysis anymore to figure out whether a midrange Android in 2019 will serve most needs.

              • scarface74 10 days ago

                I just had the pleasure of using my son’s Moto G released in 2018. He was glad to upgrade to my old iPhone 6s.

            • pjmlp 10 days ago

              Quite the contrary, hardly any performance difference for 90% of the consumers not playing Fortnite on their phones.

              No one cares about lack of updates on Android phones, only geeks like us.

              In fact many consumers disable automatic updates with fear that an update will bring a totally new UI to their favourite apps, forcing them to relearn where everything has gone to.

              Finally, by being much cheaper means that when time comes to upgrade, one gets a shiny new handset without any kind of scratches or half broken screen.

              • scarface74 10 days ago

                Like I said below, have you used the 2018 Moto G and compared it to an iPhone that's three years older -- I have. It's downright sluggish doing simple things.

                • pjmlp 10 days ago

                  One of the guys at the office last year was quite happy for sending photos, sms and doing phone calls.

                  Not everyone wants a computer on their pocket.

                  • scarface74 10 days ago

                    My son complained that he could barely use Uber or the various streaming apps.

                    • pjmlp 10 days ago

                      Your son's use case isn't an universal one, as mentioned, my work colleague doesn't do nothing of that.

                      • scarface74 10 days ago

                        I think Uber is quite popular...

                        • pjmlp 10 days ago

                          Being popular does not mean everyone uses it, specially in countries where there is regulation, thankfully.

          • robin_reala 11 days ago

            Because the previous gen iPhone will still be faster than the current gen Android and probably supported for longer?

            • pjmlp 11 days ago

              Mobile phones are a commodity now and the large majority of consumers use pre-pay phones, replacing them only when they die, get stolen or are lost.

              So none of those benefits really matter.

              • scarface74 11 days ago

                Not according to these statistics in the US.

                https://deviceatlas.com/blog/android-v-ios-market-share

                • pjmlp 11 days ago

                  US is just one country in the global market, which in your link clearly shows as being dominated by Android.

                  I thought we were talking about China here.

                  • scarface74 11 days ago

                    Did you look at the charts and the number of countries where iOS has over 40% share?

                    • pjmlp 10 days ago

                      Yes, and I have found a minority in a planet where 80% of the world is dominated by Android and a large part of the population can only dream to have a salary comparable to an iPhone cost.

                      • scarface74 10 days ago

                        And from a profitability standpoint, the people who are buying $60 Android phones aren't making anyone money besides the carriers. Why go after an unprofitable segment of the market?

                        • pjmlp 10 days ago

                          Because eventually there aren't any buyers left willing to spend buckloads of money as Apple is slowing experiencing the mobile version of PC vs Mac.

                          Their back account might hold for a couple of decades to come, but eventually they will need to come up with something else.

                          • scarface74 10 days ago

                            Yes because phones last forever.

                            Last I checked, they haven't run out of people to sell Macs to and they have been around for 35 years....u

                            Or are you saying that the "current generation of phones should be enough for anyone", Bill Gates style[1]?

                            And if Apple experience the PC vs Mac “problem” that seems to be a good thing. Apple is the only company making any serious money selling computers while the rest of the PC industry is struggling trying to chase after a few pennies. Apple just reported its highest revenue ever for a quarter selling Macs.

                            [1] Before, I get "well, actuallied", I know there is no proof he ever said that.

                            • pjmlp 10 days ago

                              Apple is still around because NeXT did an inverted take over, they were at the edge of declaring bankruptcy after the continuous failure to create a successor to MacOS.

                              Macs are a tiny percentage of current business, and only at reach of first world countries. Around 10% world wide.

                              Phones don't last forever, which is another reason not to spend diamonds on them.

                              • scarface74 10 days ago

                                https://sixcolors.com/post/2018/07/apple-q3-results-charts-c...

                                The Mac had 5.3 Billion in revenue last quarter.

                                The Mac by itself had higher revenue than McDonalds. If the Mac were a standalone business it would by itself have higher revenue than all but 110 companies in the Fortune 500.

                                And you seem to think there is actually profit by chasing after pennies in none first world countries.

                                Why the Mac is still around doesn't matter...

                                • pjmlp 10 days ago

                                  I have a book on my bookshelf to offer you.

                                  https://www.amazon.com/Cult-Mac-Leander-Kahney/dp/1593271220

                                  I think everyone is entitled to a mobile phone without having to give diamonds in exchange for one.

                                  • scarface74 10 days ago

                                    If only Apple sold an iPhone besides the 512Mb iPhone 10XS Max.

                                    You realize Jobs has been dead since 2011?

                                    • pjmlp 9 days ago

                                      Yes, which is why iPhones just look like PCs pilling features without being innovative any longer, and the Mac offerings look they the lost management just before Jobs took over the reigns and cleaned the house.

                                      The book offer still stands.

                                      • scarface74 9 days ago

                                        Which “features” have they piled on? Who has done anything “more innovative” when it comes to phones? No one has innovated on the idea of the phone since 2007.

                                        Do you still use a PC running Windows 95?

                                        You should read about “sustaining innovations”. It’s the other part of the “Innovator’s Dilemma” that most people ignore.

                                        The MacBook Air, Mac Mini, and the iMac Pro got rave reviews and again, the market spoke - the Mac had its highest revenue quarter ever.

                                        • pjmlp 9 days ago

                                          So the address where to send the book is?

            • oblio 11 days ago

              Besides the fact that your first point is not necessarily true and the second one is not a major selling point for regular users...

              If you put an iPhone 8 next to an OnePlus 6T, the iPhone will look like an Ford Model T next to the latest Ford model from 2019.

              Tech is also fashion, when we carry it around everywhere.

              And this is besides the fact that Android comes with quite a few of its own benefits, things which you can't find on iPhones.

        • ulfw 11 days ago

          If Apple things Asia would want to buy "3rd world" old iPhones, then they really haven't understood the market. iPhone is a prestige phone. It sells out for months here in Hong Kong.

          Well. Used to. This year was the first year I could buy it straight in the shop on day one. I knew right then Apple has problems.

        • mikestew 10 days ago

          They greatly overestimated willingness of locals into buying "poor man's Rolce Royce editions"

          Being kind of a car guy, I wondered how well it would work for them. Because to this day it stumps me when a luxury car manufacturer makes a budget model. The poster child for that was the Cadillac Cimarron. Take a Chevy Cavalier (one-step-above-the-low-end compact car), stick leather seats and a Cadillac badge on it, sorted. C'mon, Cadillac, people scraping together the money so they can say they own a "Cadillac" are not the people that will be upgrading to an El Dorado later. No, in fact, that they overpaid for a Chevy Cavalier because of a badge means they likely lack the financial sense to ever own a real Cadillac. All you've done is damage your brand, and pissed off Cadillac owners. (Don't get me started on the Jaguar X-type.)

          In the same vein, the budget model iPhones made me wonder if you're ever going to pull those customers into what is an relatively expensive ecosystem. HN is a poor indicator, but all I've ever heard here is "I like the SE because size" not "hey, I saved a few bucks".

          • baybal2 10 days ago

            My guess is that they did not hope to sell a lot to begin with, but just "sells enough to make money"

    • nojvek 11 days ago

      I wouldn’t buy their $1000 phones ever. I bought my first phone outright for $500. Then all the way to $700.

      I’ve kept that phone for 3 years now.

      $1000 mark just seems too steep for something that easily breaks or gets stolen.

      Esp when it’s not that different from my iPhone8

      • rchaud 11 days ago

        The Galaxy S7 I purchased on contract had a list price of C$899, which my monthly payments were defraying. 2 years later, it's still in good condition, but so are the Huawei and Nokia Android devices I purchased unlocked for C$300.

    • puranjay 11 days ago

      I used to dream of owning an iPhone.

      Now that I can actually afford it, I look at my OnePlus 5T and wonder why I would ever want "more phone" than it

cm2187 11 days ago

I’d expect the same to happen in a recession in the western world. People do not buy luxury products in a recession and if they absolutely need to replace a device, will pick one half the price that’s good enough.

Though the business model of tech giant is new, for most, the market in which they evolve isn’t. Facebook and Google’s revenues are essentially advertising, another source of revenues that is very pro-cyclical.

Amazon is retail sales, also quite pro-cyclical.

I don’t know how a cloud business would behave in a recession. Plus the cloud is still in high growth phase, kind of like smartphones or online advertising were in 2008, making the economic context less relevant.

  • alkonaut 11 days ago

    Manufacturers will ensure phone companies ensure customers buy new phones.

    In the odd event that my iPhone lasts the 24months without having a major hardware hickup (such as being shattered), somehow all the rebates disappear from my plan. A rep from my phone company calls me and says I can get a new 24 months plan WITH a new iphone, and since the new one would get the rebates I just lost, it's effectively the same monthly cost including the new phone. Being the sucker that I am, I accept and I have a new phone.

    I'm sure I could find a company that sells me a plan that would become cheaper instead of stripped of all rebates once my 24 months are over. But I'm also lazy and don't want to switch mobile networks as my current network has the best coverage in the rural areas I need to go to.

    It's a plan plan that is both simple and clever: instead of lowering the prices for buying new phones, what they do is just raise the price of NOT buying a new phone.

    • pjmlp 11 days ago

      That only works in countries that are contract driven, in those where pre-pay rules, not so much.

andy_ppp 11 days ago

Doesn't help that even I can't keep track of the differences between their phones and which lower end models they still sell and what the hell the iPhone XR is meant to be.

Feels like Apple have a really weird phone line up right now.

There used to be 3 models - iPhone classic (the previous gen maybe with a few tweaks), iPhone massive (better camera and battery) and iPhone awesome expensive high tech edition (new stuff). Now it seems to be 5 or more models in China, how can this make sense? Just stick to those three models and price them correctly and they'll get more sales.

  • close04 11 days ago

    > Doesn't help that even I can't keep track of the differences between their phones and which lower end models they still sell and what the hell the iPhone XR is meant to be.

    > Feels like Apple have a really weird phone line up right now.

    So Apple's sales are hurt because it's hard to keep track of their 3 models this year? Shouldn't the same logic basically kill Huawei's sales?

    Off the top of your head can you quickly tell me the differences between these Huawei models launched over the past year?

    Huawei Mate 20 Pro, Huawei Mate 20 Lite, Huawei Mate 20, Huawei P20 Pro, Huawei P20, Huawei Mate 10 Pro.

    And that's only counting the high-ish end. It would be a really long comment if I included all models.

    • andy_ppp 11 days ago

      Huawei isn't a premium brand in the same way Apple is so keeping things clear and focused is less important for them. I think we all know many of the reasons discussed on here has contriibuted to the downturn in sales. I'm clearly not saying it's exclusively about one issue in my comment, but you decided to rephrase it to say that, which must have been fun for you.

      Edit: Changed "X" to be "one issue" for clairty, but thay makes the following comment confusing. Sorry about that.

      • close04 11 days ago

        I said nothing about the X nor have I implied it, just about Apple’s lineup in general. Apple has a very narrow lineup that’s not that hard to follow. Huawei aims at high end and the prices confirm it. The lineup is far more complicated. And being less than high end shouldn’t really change this. If a complicated lineup kills sales it should do it for both Apple and Huawei.

        My only point is that the argument “lineup is complicated” doesn’t really have any merit. I see no point in attcking me for something that left very little room for interpretation.

    • dethac 10 days ago

      Huawei's phone lineup relies on offering an option for every price segment. Basically, it boils down to how much a user is willing to spend.

      Apple's phone lineup relies on targeting a particular market segment. If you can't afford it, save until you can.

hevi_jos 11 days ago

It is obvious. China debt bubble is bursting right now so they are sensible with prices and Apple just have raised them absurdly.

China will experience a traumatic experience(growing pains) for getting to a service economy like the rest of the world had.

If Apple continue raising prices they will lose the mass production advantage they have. Steve Jobs always created products that were affordable(like the iPod, or the inexpensive macbook) so it gave the expensive ones mass production components(like accelerometers, cameras, special glass, wifi chips, touch screens).

It seems Tim Cook had the brilliant idea of eliminating low cost products in order to raise margins(that are obscene high right now at Apple), but people are not stupid and alternatives exist.

  • tivert 10 days ago

    > Steve Jobs always created products that were affordable....It seems Tim Cook had the brilliant idea of eliminating low cost products in order to raise margins...

    One of the smart things about Jobs's product structure is that it put people on a position to take a chance on Apple by buying a low-end product, then they could migrate into the more expensive end once they got used to Apple. There's a reason it's called the entry-level, and getting rid of it is foolish.

eastendguy 11 days ago

Next headlines:

2020: European Car Shipments Plunge in China as XXX(#) Tightens Grip

2025: Tesla Car Shipments Plunge in China as YYY(#) Tightens Grip

(#) Any local company currently in favor with the ruling party.

  • entity345 11 days ago

    That's simplistic.

    People forget, or simply don't know, that Chinese are extremely patriotic and that they remember how "the foreign powers" treated them in the past.

    Considering what's happening between the US and China, and about Huawei, we can't discard the possibility that Chinese consumers reacted by supporting their country.

    • threeseed 11 days ago

      People also forget that they shouldn't speak for a billion odd people. It's a big country with a lot of diversity both culturally and socioeconomically.

      The facts we do know are that (a) price affects sales, (b) China has a lot of well made, value focused phones and (c) Apple has already acknowledged their iPhones are expensive.

      • entity345 11 days ago

        China is extremely homogeneous on the points I raised.

        I did not claim that they were the cause of the drop but simply that these are factors that may also be at play.

        • junket_operator 11 days ago

          North is much more patriotic and aligned with the nationalistic one China narrative than the South. If you have lived in the South, you can encounter more ambivalent view.

          CPC puts huge effort to maintain the illusion of unity. The recent ramp up effort to suppress Cantonese is just one example. 80 million people (equal to the population of Germany) speaks Cantonese. Overall 400 million Chinese still can't speak Mandarin.

        • raverbashing 11 days ago

          > China is extremely homogeneous on the points I raised.

          Yes, those who disagree are sent to be "reeducated"

          • entity345 11 days ago

            I'm living this 'discussion' now.

            The reactions to my comment are absolutely appalling.

            • raverbashing 11 days ago

              "Doctor, it hurts when I do this" "Then stop doing it"

    • ekianjo 11 days ago

      > that Chinese are extremely patriotic

      Like in most countries where education is tightly controlled by the government, patriotism is a result of state propaganda.

      > how "the foreign powers" treated them in the past.

      The worst thing that happened to Chinese was not the way foreign powers treated them, but what came after under their own ruling party.

      • puranjay 11 days ago

        Your comment sounds awfully like colonial revisionism

      • entity345 11 days ago

        Talking about propaganda, you must have been subjected to massive quantities to write such a reply that provides no counter arguments and that is completely ignoring the points made, not to mention how ignorant it is.

        Sad, really.

        • ancorevard 11 days ago

          > The worst thing that happened to Chinese was not the way foreign powers treated them, but what came after under their own ruling party.

          Does one really need references for this?

          Aren't everyone aware of the massive socialist experimentations Mao executed on China's people?

          The lowest estimate available is that 50 million people were killed (high end estimate closer to 80 million dead) due to political purges (cultural revolution etc.) and starvation (socialize farming, great leap forward, etc.).

          • Synaesthesia 11 days ago

            A great deal of those died due to a famine. If one compares China’s development with India’s you see that over 100 million extra Indians have died since 1947 due to worse medical outcomes. (Amyarta Sen)

            • ekianjo 11 days ago

              The famine was a result of collectivization, which had led to disastrous results in other countries which tried that before: such as the USSR experiments in Ukraine. Plus:

              > https://en.wikipedia.org/wiki/Great_Leap_Forward#Consequence...

              > The failure of agricultural policies, the movement of farmers from agricultural to industrial work, and weather conditions led to millions of deaths from severe famine. Many also died from quota-based executions instituted by government officials. The economy, which had improved since the end of the civil war, was devastated.

          • entity345 11 days ago

            Why are you picking on this and ignoring my original comment?

            Simpler to repeat the same thing again and again without thinking, isn't it?

            I thought mature discussions was what HN was about. I'm sorry to see that bigotry is rife.

            • JohnJamesRambo 11 days ago

              Bringing up a fact of 50-80 million lives lost is not “picking on” something.

              • vetinari 11 days ago

                The number of 50-80 million comes from the book "Black Book of Communism", which in itself is highly controversial and whose co-authors disassociated themselves from the author due to the methodology used.

                So take these numbers with grain of salt and consider the book and its claim just a propaganda tool.

                • ekianjo 11 days ago

                  > It is widely regarded by historians that The Great Leap resulted in tens of millions of deaths.[3] A lower-end estimate is 18 million, while extensive research by Chinese historian Yu Xiguang suggests the death toll from the movement is closer to 55.6 million.[4] Fellow historian Frank Dikötter asserts that "coercion, terror, and systematic violence were the foundation of the Great Leap Forward" and it "motivated one of the most deadly mass killings of human history".[5]

                  > https://en.wikipedia.org/wiki/Great_Leap_Forward

                  So your point is? Regardless of the actual figures, it was probably the worst genocide of History.

                  • vetinari 11 days ago

                    My point is, it is easy to claim ridiculous numbers, but much harder to prove them. It doesn't help the case, if they numbers are inflated for the shock value.

              • entity345 11 days ago

                Now, that's pure bad faith. The point is that that has absolutely nothing to do with the discussion.

                I find amusing that those so vocal against that period of Chinese history use the exact same methods to destroy critical discussion.

    • Aloha 11 days ago

      When did these foreign powers mistreat China? The 19th century? Most nationals cultural memories are not that long - specifically one that has been thru three major revolutions in a century.

      Whatever the cause of lower iPhone sales, I'm skeptical it's what you claim - sunspots seem more likely to me.

      • yling234 11 days ago

        The opium wars may have been in the 19th century but the WW1 reparations, Sino-Japanese wars, rape of Nanking, and general widespread attemps to carve territory from China, especially Western approval of the Sino-Japanese sphere of influence, were all 20th century. Western powers supporting the violent partioning of China was the norm even in the 20th century (look at Churchill's comments on the matter).

      • azurezyq 11 days ago

        It's 20th century and we will never forget.

        I agree that some leaders were stupid but we generally agree they are our own business. I'm not surprised that Xi may one day be overthrown. but with some new government, we are still patriotic. Basically it's because our thousands of years of history doesn't allow us from being discriminated by anyone, IMO.

        For iPhones, I'd say they're just not sexy. The design and color are boring. Super expensive for the hardware you get. Also Apple's ecosystem doesn't really matter in China. WeChat and a few apps make iPhones and Android roughly same experience.

        • woah 11 days ago

          Regardless of what happened in history, people will only know about it if they are taught it. I assume that knowledge about the failings and oppression by the CCP is not taught in school. It’s also well known that the current Chinese government has the biggest censorship and propaganda system in the world. So the Chinese people’s opinion is relevant in that it is what they think, but it is also not necessarily a reflection of more than their government’s propaganda efforts.

        • saiya-jin 11 days ago

          > It's 20th century and we will never forget.

          You mean Japanese in WW II? Bear in mind that generally, regardless of the country, being raised as overly patriotic equals to being brainwashed by educational system into lies and selective semi-truths about your history, the politics and what is actually happening in the world. Makes a good army of obedient robots, but not much more. In long term, it screws up given nation/group of people since reality will eventually bite back.

  • Panoramix 11 days ago

    In my opinion Huawei has better products than Apple so this is not surprising.

ohiovr 11 days ago

The original iPhone cost $499 according to google search.

  • robin_reala 11 days ago

    …with a contract in the US.

    • ohiovr 11 days ago

      People wouldn’t spring for the same exact deal at that price? Seems a lot of people are fine with throwing 70 dollars a month just on the service even with tons of alternatives that are a fraction of the cost.

glenrivard 11 days ago

Not surprising and not only China. Problem is people are just replacing their iPhones less often.

dis-sys 11 days ago

According to a recent study, Chinese iPhone users are more likely to be low income/undereducated.

https://www.scmp.com/tech/article/2174310/research-highlight...

  • thaumasiotes 11 days ago

    From personal experience (highly biased), it's easy to find iPhones belonging to everyone from elite university students to convenience store clerks.

    That doesn't say anything about whether iPhone owners are more likely to be low-income or high-income, but there are a lot more low-income people than there are high-income people...

    • oblio 11 days ago

      In the US, maybe :)

      • thaumasiotes 10 days ago

        What are you talking about?

        • oblio 10 days ago

          > it's easy to find iPhones belonging to everyone from elite university students to convenience store clerks.

          In the US, maybe. The average world GDP per capita PPP is $17k. The US GDP per capita PPP is $59k, almost 4x the world.

          In most of the rest of the world, including other developed countries, "convenience store clerks" definitely don't have iPhones.

          • thaumasiotes 10 days ago

            I'm just telling you what I see in China. Convenience store clerks do have iPhones, regardless of how you feel about it.

  • msh 11 days ago

    That does not really sound like a study, more like propaganda. I don't know if it's true but that article is not that credible.

  • kumarvvr 11 days ago

    I suspect a lot of money in the China flows illegally, out of the sight of the tax man (black money, money that is off the books), so having an iPhone could be one of the ways to spend such money, as it can't be deposited in banks or other track-able outlets.

    Perhaps it's a status symbol too, shows that you are well to do and financially stable.

    • kwizzt 11 days ago

      I don't think the black money you proposed is very likely.

      If I have several thousand dollars of black money, that's not much and no one cares.

      OTOH, if you have a lot of black money, let's say in millions of dollars, buying a single iPhone doesn't really help at all. Yet buying a bunch of iPhone's seems to be very inconvenient unless you are selling them to someone else.

      Status symbol was more likely 5 or 10 years back. Nowadays not a lot of people actually care about what phones you are using (at least the ones I know, potential selection bias there).

      My guess is that people simply don't care about having an iPhone vs an Android anymore. Especially so when Android phones don't suck or can be better than iPhone now.

JackPoach 11 days ago

Trade wars are a bitch

mtw 11 days ago

I am neither Chinese or American - The US targeting Huawei seems unfair. It is like suspecting a person of theft and then applying all sorts of punishments, without any strong proof. This is not justice. If I were Chinese, you bet I won't buy any American product.

baybal2 11 days ago

People in the West don't get a lot about Chinese society, nor do ones who come and go to China on few year long stays in better parts of China.

Yes, China has fake Prada, tons of fake Prada, but you don't really get a lot of people going for Pradas invariably of its genuineness. Same for iPhone users - there are extreme cases of idiots selling their organs to buy one, but to most people - the brand may be near invisible, moreover to people outside of megacities.

China's rich don't necessarily come from big cities. There are way more millionaires outside the Beijing/Shanghai/Guangzhou trio than inside. In fact, mid-tier cities have more millionaires per capita than megacities.

It's only natural that marketing of big foreign brands that primarily target megacities gets what is sows - a very proletarian, working class demographic.

I want to add that Amazon got a hunch of that recently - Amazon China was a joke up until their last few campaigns that were targeting almost exclusively second tier cities. To everybody's surprise, that move made them to near double their business here in around one year.