February 15, 2008 3:41 PM PST

China Mobile running 400,000 unlocked iPhones

As many as 400,000 unlocked iPhones were running on China Mobile's cellular network at the end of last year, according to market research firm In-Stat.

Apple sold 3.7 million iPhones in 2007, and more than 10 percent of them are in China, In-Stat said, attributing that information to China Mobile. That helps explain part of the "iPhone gap" created by the difference between Apple's shipping totals for 2007 and the activations reported by its carrier partners in the U.S. and Europe.

Somewhere around 1 million iPhones are thought to have been unlocked, and 400,000 are in China.

(Credit: CNET Networks)

Despite Apple's attempts to keep iPhone unlocking under wraps with new software and changes to the iPhone's bootloader, enterprising entrepreneurs are apparently giving the people what they want. This is a bit of an opportunity lost for Apple, since the company has signed lucrative revenue-sharing deals with its carrier partners that don't apply if an iPhone is unlocked from its respective network.

But, as In-Stat noted in a report, at least it shows people want the iPhone. The firm said Chinese consumers want smartphones with multimedia features and Web browsing, and the iPhone fills that need nicely. And they're willing to pay for it: 20 percent of smartphones sold in China last year went for 4,000RMB ($533) or more.

Apple had at one point discussed the iPhone with China Mobile, but Apple CEO Steve Jobs downplayed the significance of those talks, saying the companies just had a single meeting. The iPhone is set to make its official debut in Asia at some point in 2008, probably sooner rather than later, but it's clearly a hot item in China already.

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Add a Comment (Log in or register) 28 comments (Page 1 of 1)
Carrier Lock
by 42istheanswer February 15, 2008 6:45 PM PST
Carrier lock-in was a stupid idea. The actions taken by the Chinese is a big surprise? I would love to have an iPhone, but there is NO AT+T service in my rural area. Bummer.
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Could have told you that months ago
by mgichg February 15, 2008 7:59 PM PST
I could have told you this 6 months ago. I live in Hong Kong and all my friends have iPhones. They are sold sell in every phone shop, computer shop and even in shamshuipo street stalls in Hong Kong, apart from the official network carrier phone stores. I purchased mine in here in Hong Kong in September 2007 and there was no shortage of them around. All of a sudden one day in September the market was flooded with them here. They were all sold unlocked, ready to go and even had a chinese sms program preinstalled for the local market. And everytime apple releases a software update, you just take it into the shop you bought it from and they'll do the upgrade for you. No wonder China mobile will never agree to Apples terms. They're already making money off people using the iPhone, why should they give money to Apple for it? I honestly don't see how any other carrier worldwide would agree to Apples terms when its blatantly obvious that anyone can hack an iPhone with just a toothpick and a putty knife MacGuyver style.. Plus I'm sure you've all seen the iPhone fakes floating around in China right? Ask anyone here in Hong Kong and they'll tell you that no carrier here will ever agree to Apples terms for the iPhone when they're already being used here on their networks without having to pay Apple for the "privilege". I would love to be in on one of those meetings when Jobs is trying to convince a network to pay him for the phone that they are already having people use on their networks. That must be one hell of a sales pitch. But I guess you cant win them all. PS love my iPhone, will never be able to use any another phone ever again. And 400,000 in China is probably a low estimate, very low.
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Does not represent lost revenue
by rdupuy11 February 15, 2008 9:09 PM PST
As the author of this article is perfectly well aware, the selling of additional phones represents additional revenue, not lost revenue. His idea that it represents lost revenue is based on a fictitious belief that you can assume that the Chinese would have paid additional revenue, had they been successfully denied access to the phones. He needs to learn a bit about China. 400K additional sales, is big bucks for apple, and they were never going to force the Chinese into the outrageous, and quite frankly, shameful gouging that Apple has done to the Americna public.
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accounting for refurbished/ replacement iPhones
by krb5kdc February 16, 2008 2:39 AM PST
How are refurbished/ replacement iPhones accounted for? During the early days of the iPhone rollout, in 1 hour of observing the Genius bar at a Manhattan Apple Store you could easily see 10+ people having their broken iPhones replaced on the spot! The Genius would just pull out a plain box (coffin) with a replacement iPhone from a seemingly endless supply. How are these "extra" iPhones that must be at every Apple Store, Apple repair depot and possibly AT&T stores accounted for!?
Reply to this comment
Very "American" of them
by perfectblue97 February 16, 2008 9:21 AM PST
It seems like Apple is behaving like a communist state by restricting people and China is behaving like a capitalist enterprise by giving them what they want.
Reply to this comment
When marketing and distribution conflict
by pdenlinger February 16, 2008 3:31 PM PST
I wrote about China demand for iPhones in this "Apple's iPhone Marketing in China Leverages Global Buzz" http://www.chinavortex.com/2007/09/apples-iphone-marketing-in-china-leverages-global-buzz/ which I published last September. This is why China Mobile does not need a data-sharing agreement with Apple. iPhone users spend much more on data than other mobile phone users; why should China Mobile share this revenue with Apple? As far as China Mobile is concerned, the more people who use cracked iPhones in China, the better... Now if the iPhone had WiFi capability, they might feel differently...
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Simple... Foreigners in China
by winstein February 16, 2008 9:11 PM PST
There are many, many businessman and women working in and travel to China. Many, many of them are from the US and other countries that have access to iPhones.
Reply to this comment
Lost revenue?
by justinnewton February 17, 2008 10:43 AM PST
This article speaks of the iPhones being used on other networks as a "lost revenue opportunity". It isn't. Those phones were purchased SPECIFICALLY to be hacked and run on China's network. Had people not been able to unlock those phones they wouldn't have been sold AT ALL. This is very different from what happens when someone buys an iPhone, unlocks it and then runs it on the TMobile network here in the US. In that case it is a lost revenue opportunity, as if the phones couldn't be unlocked those users (may) have still bought the phone and run it on ATT's network. In the case of users in China, there is no carrier there who shares revenue with Apple, so if you could not unlock the iPhone they would not have sold those units at all. Duh. Justin
Reply to this comment
Role reversal ?
by vminvic February 17, 2008 11:13 AM PST
Funny how the "capitalists" (Sony/Intel/Microsoft/Apple) are dead set on forcing customer to take only what they dictate. "Commies" do work around to give customer what he really wants. Expect a cheap generic brand ALL CHINESE & UNLOCKED smart phone to capture the world market soon.! Same idea as region free DVD player. "Free" (Chinese) market will deliver what customer asks for - despite what big corporations try to prevent it.
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apple TV and the 24 hour movie limit joke.
by brettpweb February 17, 2008 9:12 PM PST
Hey...can you get a message to Steve J.... I have an apple tv and if he wants me to rent more videos from him he needs to open up the 24 hours to watch a movie to at least 48 hours or 72 hours... I am disappointed that I could not watch Underdog one more time the 2nd night and it already dissappeared from my apple tv menu...this just sucks!...I will continue to pay for my netflix monthly rental until he changes this policy... and I will not rent from apple until he makes this change... good luck...
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