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IDC: Apple's ranking in China falls

Dec 06 2012 17:20 Reuters

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Hong Kong - Apple's rank in China's smartphone market, which is set to become the world's largest this year, fell to No.6 in the third quarter as it faced tough competition from Chinese brands, research firm IDC said on Thursday.

IDC's announcement comes a day after Apple's shares fell more than 6% on the Nasdaq, logging its biggest single-day loss in four years and losing $35bn of its value, on concerns about rivals gaining ground in the mobile devices market.

China, already the world's biggest mobile phone market, is seeing competition intensifying in its smartphone sector, with global and homegrown vendors trying to outgun one another in terms of price and features.

Underscoring that, Nokia announced on Wednesday it is to partner China Mobile, the country's largest wireless carrier, in a sales deal that will give the Finnish company an opportunity to win back some Chinese market share from Apple's iPhone.

Apple saw its third-quarter ranking by market share fall two notches from its position in the second quarter, IDC said. Its market share by shipments was under 10% in the third quarter, when China's smartphone shipments hit a record high, at more than 60 million units, the research firm added.

However, IDC analysts expect a rebound with the launch of the iPhone 5 in China in December. Apple last week received approval from regulators for the sale of the iPhone 5 in the country.

Galaxy-maker Samsung Electronics, the world's No.2 PC maker Lenovo Group and global No.2 telecom equipment maker Huawei Technologies retained the top two and No.5 spots, respectively, IDC said.

Chinese brand Coolpad made a three-spot leap to No.3 in the country, but ZTE Corp dropped one place to No.4 in the July-September period, IDC said. The research firm did not give the market share numbers of any company except Apple.

"Chinese vendors Coolpad, Lenovo and ZTE made it to the Asia Pacific ex-Japan top 5 vendors on strong performance in their home market, showing that it is not impossible for Chinese vendors to surpass international vendors," Wong Teck-zhung, a senior market analyst at IDC, said in a statement.

Generous subsidies

China now has more than one billion mobile phone subscribers though less than a fifth are 3G subscribers.

The country's three mobile carriers, China Mobile, Unicom and Telecom have been doling out generous handset subsidies to try to attract higher-end users keen on online gaming and social networking.

Chinese vendors are also offering smartphones in the sub-1 000 yuan ($160) category.

"Price continues to be king," Jeff Lorbeck, senior vice president for US mobile chip maker Qualcomm's product management, told reporters in a conference on Thursday.

"The local China brands are becoming increasingly important in both the carrier channels and open-market channels, so a lot of the tier 1 global brands are being displaced by China's local brands."
samsung  |  apple  |  china  |  smartphones
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