IDC: Apple's China iPhone almost halves in Q2

Apple's mobile market share in China has dropped by almost half, while Lenovo saw its share rocket. Is China still a tough cookie for Apple to crack?
Written by Zack Whittaker, Contributor

Apple's mobile market share in China has almost halved to 10 percent in the second-quarter, according to figures released by research firm IDC today. 

The numbers suggest that soon-to-be and existing Apple customers are waiting for the next iPhone, expected in September, or jumped ship entirely in favor of rival smartphones. 

Enter Lenovo, which managed to knock Apple off its second place perch to fourth place in the world's largest market, despite smartphones overtaking feature phones for the first time during the April--June period.

China-based Lenovo, currently the world's second-largest PC maker -- though soon to be the market leader in a matter of weeks -- managed to snap 11 percent in China during the second quarter. While its share only increased by a single point in the first quarter, Lenovo rocketed ahead of Apple during the following quarter. 

Lenovo now stands at 11 percent of the China mobile market share, up one point on fourth-place Apple.

China-based ZTE is currently in third place, while and Huawei stands in fifth place.

Make room for Samsung, retaining its vast lead on the rest of the market, with a share of 19 percent. However, Samsung's losses widened as it dropped by 2 percent on the previous quarter.

IDC said smartphone shipments in China totalled 44 million devices in the second quarter, pegging around 51 percent of the country's overall 87 million mobile shipments, the research firm said. 

UBS analyst Steven Milunovich said earlier this week that most of China's sales of the iPhone 4S can be mostly attributed to "seasonality," notably the long-awaited iPhone 5, which is expected to make an appearance next month. 

But Apple's market penetration isn't what it could be. The Cupertino, CA.-based technology giant has roughly one retail store per 216 million Chinese citizens -- or six stores for a population of around 1.3 billion people -- despite Cupertino saying it would have at least 25 stores in China by the end of this year. Half the argument could be that Apple simply isn't visible enough on the main street. 

Compare that to Massachusetts, which has 10 stores for only 7 million people; it's no wonder Apple is finding China "hard to crack," according to ZDNet editor Andrew Nusca.

While the iPhone is not a failure in China, a mix of a slower product cycle, difference in spending priorities, and a bevy of different and diverse domestic and nearby smartphone makers at cheaper prices makes the iPhone a luxury many either cannot afford, or simply wait for.

via Reuters.

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