Reporters play with the new iPhone models at a launch event in Beijing on Sept. 11. (Photo/Xinhua)
Apple's market share in China continues to shrink with the rise of domestic smartphone makers and the underwhelming public response to its new top-end iPhone 5S and cheaper iPhone 5C smartphones, reports the Shanghai-based First Financial Daily.
On Monday, Apple share prices tumbled 3.18% to US$450.12, falling 11.07% from US$506.17 before the firm unveiled its latest iPhone models. On Sept. 10, Apple unveiled its top-end iPhone 5S and a cheaper iPhone 5C, but it has triggered more criticism than praise, prompting a short-term crisis of confidence as Apple fans seek reassurances in the post-Steve Jobs era, according to the tech portal of Chinese website Sina.
The top-end 5S model introduces a fingerprint sensor built into the phone's main button to identify the user, while the 5C comes with a plastic back in a choice of colors. China Unicom — one of the country's three main state-owned telecoms — announced on Sept. 15 that it has received more than 100,000 preorders for the two handsets, but the orders are half the number reported for the company's iPhone 5 launch last year, where more than 200,000 handsets were ordered in the first two days.
Many domestic smartphone makers feel relieved as the "budget" iPhone 5C is still relatively expensive compared to other budget models, said Huawei Device chairman Yu Chengdong, who expects Apple's competitiveness and market share to continue to fall in the segment of the market dominated by cheaper Android handsets.
It seems Apple selects profitability instead of market share, the paper said. Meanwhile, its rivals Samsung, Lenovo and Huawei have used a volume strategy to gradually dominate the smartphone market. According to market research firm Strategy Analytics, in the second quarter of this year, the Android system has taken 79.5% of the smartphone market share, while Apple's iOS accounted for just 13.6%.
Previously, most handset makers tried to avoid Apple launches when it introduced new products, but now nearly 10 domestic companies chose to unveil their products at the same time as the new iPhones. Insiders say that Apple's secret to success was to install the best software in the best hardware, and such a model has triggered an innovation in the industry. Chinese handset makers are now learning from Apple, and increasing their research and development units to at least 1,000 technicians in a bid to be competitive in the industry, the paper said.