iPhone's high price makes it a tough sell in world's biggest phone market, China

China is not only the most populous country in the world, it recently surpassed the United States in number of mobile subscribers and is now also the biggest mobile market. But while in the United States, the iPhone easily dominates the scene, in China where phone subsidies are not that common a bunch of smaller local companies attract users with their much cheaper devices.

Xiaomi for once makes a phone with comparable if not better specs than the iPhone and while it runs Android, it resembles Apple's device a bit in design and has a simple interface, all for nearly half the price of the iPhone. And urban Chinese dwellers with an average salary of around $400 monthly prefer to got for this type of affordable devices.

Indystry analyst IDC data backs that up with stats saying that under $200 phones took a 40% share of all shipped phones. Luxury devices like the iPhone costing over $700 make up 11% of the market. In China, the iPhone retails for around $800.

"Apple isn't going to rule China, simply because of the limited models they have and the price points they target," IDC analyst TZ Wong said. "Based on these two factors, we do not think Apple will be the No. 1 smartphone player in China."



Again taking China's biggest success story recently, Xiaomi, we'd see that at launch its phones sell out virtually in minutes. And while you have to pay hundreds to attend Apple's big events in California, Xiaomi takes pride in charging only around 200 yuan, or just over $30 for its get-togethers, with all proceeds donated to charity.

With Windows Phone 8 soon to be out, the landscape in China will become even more hostile for the iPhone, according to analysts. Some predict that by 2016, Apple will drop below both Android and Windows. In either case, it's an interesting market to watch.

source: IDC via Reuters